The United States District Court For The Southern District Of Mississippi, Southern Division, recently found an agreement to arbitrate in a home mortgage was invalid in Richards v. Gibson.
The court cited 15 U.S.C. § 1639c(e) which was enacted by the Dodd-Frank Act. That statute provides:
No residential mortgage loan . . . secured by the principal dwelling of the consumer may include terms which require arbitration or any other nonjudicial procedure as the method for resolving any controversy or settling any claims arising out of the transaction.
