Gregory Geraci and Beverly Geraci, Husband and Wife on Behalf of Themselves and of All Others Similarly Situated v. Homestreet Bank

347 F.3d 749 Gregory GERACI and Beverly Geraci, husband and wife on behalf of themselves and of all others similarly situated, Plaintiffs-Appellants, v. HOMESTREET BANK, Defendant-Appellee. No. 02-35426. United States Court of Appeals, Ninth Circuit. Submitted September 11, 2003 * — Seattle, Washington. Filed October 20, 2003. 1 Hart L. Robinovitch, Zimmerman Reed, P.L.L.P., Scottsdale, Arizona, for the plaintiffs-appellants. 2 Michael J. Agoglia, Morrison & Foerster L.L.P., San Francisco, California, for the defendant-appellee. 3 Appeal from the United States District Court for Western District of Washington; Thomas S. Zilly, District Judge, Presiding. D.C. No. CV-01-1465-Z. 4 Before: Michael Daly HAWKINS and Marsha S. BERZON, Circuit Judges, and Justin L. QUACKENBUSH, Senior District Judge. ** 5 Opinion by Senior District Judge QUACKENBUSH; Concurrence by Judge BERZON. OPINION QUACKENBUSH, Senior District Judge: 6 This is another action in a series of claims by parties who have obtained mortgage loans contending that the origination fee they paid their mortgage broker, in this case, Windermere Mortgage (Windermere), and the yield spread premium (YSP) paid by the…

Opinion by Senior District Judge QUACKENBUSH; Concurrence by Judge BERZON.

This is another action in a series of claims by parties who have obtained mortgage loans contending that the origination fee they paid their mortgage broker, in this case, Windermere Mortgage (Windermere), and the yield spread premium (YSP) paid by the mortgage lender, in this case the Defendant Homestreet Bank (Homestreet), to Windermere, exceeded a statutory 1% cap on fees paid by the borrowers. See Lane v. Residential Funding Corp., 323 F.3d 739 (9th Cir.2003); Bjustrom v. Trust One Mortgage Corp., 322 F.3d 1201 (9th Cir.2003); Schuetz v. Banc One Mortgage Corp., 292 F.3d 1004 (9th Cir.2002), cert. denied, 537 U.S. 1171 , 123 S.Ct. 994 , 154 L.Ed.2d 913 (2003).

The Plaintiffs Gregory and Beverly Geraci contend the YSP, added to the origination fee, exceeded the 1% cap on Veteran Administration (VA) fees. The Plaintiffs also contend that the YSP paid by Homestreet to Windermere was “excessive,” although the Plaintiffs’ First Amended Complaint does not specifically allege that the Homestreet payment to Windermere constituted an illegal “kickback” or referral fee in violation of the Real Estate Settlement…

concurring:

As I said in concurrence in Bjustrom v. Trust One Mortgage Corp., 322 F.3d 1201 (9th Cir.2003), in my view, ‘Yield spread premiums and similar devices violate the anti-kickback provisions of the Real Estate Settlement Procedures Act (RE SPA), 12 U.S.C. § 2601 et seq., because they are payments from the lender to the broker and base the amount of the payment solely on the value of the loan to the lender.” Id. at 1209 ; see also Schuetz v. Banc One Mortgage Corp., 292 F.3d 1004 (9th Cir.2002) (Kleinfeld, J., dissenting). As the issue has been decided in this circuit, however, for good or ill, I concur in the opinion.