Washington, et al. v. Countrywide Home Loans, Inc., No. 10-1340 (8th Cir. 2011)
Annotate this CasePlaintiffs, on behalf of a putative class, sued defendant under the Missouri Second Mortgage Loan Act (MSMLA), Mo. Rev. Stat. 408.231-408.241, alleging that defendant charged them unauthorized interest and fees in violation of section 408.233.1 of the MSMLA. At issue was whether defendants violated the MSMLA by charging plaintiffs a loan discount, settlement/closing fee, document processing/delivery fee, and prepaid interest. The court held that plaintiffs did suffer a loss of money when defendant charged the loan discount, although plaintiffs received the loan discount amount two days later as part of a loan disbursement. The court also held that it could not decide whether the loan discount and the settlement/closing fee violated the MSMLA and remanded for further proceedings. The court further held that the document processing/delivery fee was not included in section 408.233's exclusive list of authorized charges and violated the MSMLA. The court finally held that because the processing/delivery free violated the MSMLA, the prepaid interest was an additional violation of the statute. Therefore, the court reversed and remanded to the district court for further proceedings.
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Court Description: Civil case - Class Action Fairness Act. District court erred in finding that plaintiffs did not suffer a loss for purposes of the Missouri Second Mortgage Lender's Act because the lender later disbursed fees which had been collected in error; this court could not determine whether the fees violated the Act, and the matter would have to be remanded to the district court for further proceedings on the issue; district court erred in finding a $60 document processing/delivery fee was an authorized closing cost under the Act as Missouri courts have found such fees are not authorized; because the lender was precluded from collecting the processing/delivery fee, its collection of $37.80 in prepaid interest also violated the Act.
The court issued a subsequent related opinion or order on September 9, 2011.
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