Calling out loan underwriting fees

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Alinda and Armando Martinez refinanced their home loan, obtaining a new loan from Wells Fargo. Wells charged the Martinezes an $800 underwriting fee, which the Martinezes alleged was excessive and not reasonably related to Wells Fargo's actual costs of underwriting their new loan. The Martinezes filed suit against Wells Fargo on their own behalf and for a class of others, alleging that Wells Fargo violated the prohibition of unearned fees in Section 8 of the U.S. Real Estate Settlement Procedures Act (RESPA), and was also "unfair," "fraudulent" and "illegal," all in violation of California’s Unfair Competition Law. The trial court dismissed the Martinezes' RESPA claim, on grounds that even if the $800 fee was an overcharge, Wells Fargo had, in fact, performed a service to earn the fee, so that the fee did not violate RESPA's unearned fee provision. Additionally, the trial court ruled that the Martinezes' claims that the underwriting fee was ...