Supreme Court gives homeowners another chance in escrow dispute with Bank of America
The Supreme Court has given homeowners another chance to force Bank of America and other large banks to pay interest on mortgage escrow accounts
WASHINGTON (AP) — The Supreme Court on Thursday gave homeowners another chance to force Bank of America and other large banks to pay interest on mortgage escrow accounts.
The court unanimously threw out an appeals court ruling in favor of Bank of America, which has refused to pay interest on money it collects to pay borrowers' insurance and property tax bills. New York requires banks to pay at 2% interest on escrowed funds.
Thirteen other states have similar laws: California, Connecticut, Iowa, Maine, Maryland, Massachusetts, Minnesota, New Hampshire, Oregon, Rhode Island, Utah, Vermont and Wisconsin.
A federal judge initially ruled in favor of the borrowers, but the federal appeals court in New York granted Bank of America's request to dismiss the suits, arguing that the federal law governing national banks does not permit such state-by-state regulation.
