ABSTRACT: Federally chartered banks may soon be required to comply with state consumer protection laws that require banks to pay at least 2% interest on mortgage escrow accounts. The Supreme Court will decide the issue during its upcoming term in Cantero v. Bank of America.
The Second Circuit recently ruled—in favor of Bank of America—that the National Bank Act preempts state laws that require financial institutions to pay interest on mortgage escrow accounts. Currently, only 13 states have such laws, but states may decide to expand their authority if the Supreme Court rules to broaden state power over federally
Continue Reading After Years of Mortgage Escrow Limbo, National Banks Will Soon Learn Their Fate