Court ruling could weaken regulation of RE payoff schemes

From the New York magazine’s November issue: A decision by a federal appellate court last month is casting new light on practices in the real estate field that buyers and sellers often know little about: creative, under-the-table payoff schemes among realty brokers, mortgage lenders and title companies that can stifle market competition and raise settlement costs to consumers by hundreds or even thousands of dollars.

The court case involved a $109 million fine levied against mortgage lender PHH Corp. by the Consumer Financial Protection Bureau for allegedly violating the federal real estate anti-kickback statute through its mortgage-insurance operations. PHH disputed the charges and filed suit, challenging not only the CFPB’s interpretation of the anti-kickback law but the bureau’s constitutionality. [more]