Veterans United Asks a Federal Judge to Throw Out the RESPA Class Action

A first-time homebuyer who is also a veteran walks through the door of a real estate office, almost always pre-qualified by someone, almost always told that the loan part is taken care of. The agent has worked with hundreds of buyers like this one. The agent knows the lender they are supposed to recommend. They use the right verbs. They send the right link. The buyer signs the papers, moves in, and never quite knows whether the loan was the best one available — or whether the agent who guided them there had any choice in the matter. That, in plain language, is what a Western District of Missouri complaint accuses Veterans United Home Loans of designing on a national scale. On April 13, 2026, the defendants asked a federal judge to throw the case out.

The Complaint, in Plain Language

The case is Peyton, et al. v. Veterans United Home Loans, et al., No. 2:26-cv-04039-WJE, filed February 18, 2026 in the U.S. District Court for the Western District of Missouri before Chief Magistrate Judge Willie J. Epps Jr. The named defendants are Mortgage Research Center, LLC (which does business as Veterans United Home Loans), Veterans United Home Loans, and Realty Search Solutions, LLC d/b/a Veterans United Realty. The three named plaintiffs — Christian Peyton (a Tennessee veteran), Salem Zahn (a Texas veteran), and Ernest Easter (a Pennsylvania veteran) — propose to represent a putative nationwide class of veteran borrowers and are represented by Hagens Berman Sobol Shapiro LLP.

Stripped to its working parts, the complaint alleges two interlocking arrangements. First, that Veterans United operates a network of independent real estate agents to whom it provides leads, and that those agents are required, as a condition of remaining on the lead list, to steer their clients to use Veterans United for the mortgage — even when, plaintiffs allege, a different lender would offer a better rate or a cheaper loan. Second, that preferred agents make payments of approximately 35% of their real estate commissions back to a Veterans United–affiliated entity on each closed transaction. Plaintiffs allege that this structure was not disclosed to them, that they were not told their agents had been pre-conditioned to steer them, and that, as a result of the alleged steering and commission-split arrangement, they paid more for their loans than they would have if the choice of lender had been independent of the choice of agent.

The legal claims center on Section 8 of RESPA, 12 U.S.C. § 2607, which prohibits both kickbacks for the referral of settlement-service business and unearned-fee splits. Section 8(a) prohibits giving or accepting any "fee, kickback, or thing of value" pursuant to an agreement or understanding for the referral of settlement-service business. Section 8(b) prohibits accepting any portion of a charge for settlement services other than for services actually performed. The complaint also pleads a Missouri Merchandising Practices Act claim — which expressly alleges that defendants used the "Veterans United" name and website to present themselves as part of or affiliated with the U.S. Department of Veterans Affairs while operating as private for-profit entities — and a common-law unjust-enrichment count. The complaint pleads relief under RESPA's private remedy at 12 U.S.C. § 2607(d), which provides that a person who violates Section 8 is liable to the person charged for the settlement service in an amount equal to three times the amount of any charge paid for that service, together with court costs and reasonable attorneys' fees. As pleaded, plaintiffs allege that the choice their agents made on their behalf was not free, that it was the product of an arrangement they did not see and did not consent to, and that the cost of that arrangement was passed through to them in the loan terms.

The Motion to Dismiss

Defendants' motion to dismiss was filed April 13, 2026. Wright Law Firm has not independently reviewed the motion as filed, and the description that follows reflects what defendants are reported to argue based on public docket entries and contemporaneous trade-press reporting; the precise arguments should be checked against the motion itself before any reader takes action in reliance on this article.

Defendants' principal RESPA argument, as reported, turns on the cooperative-brokerage carve-out. Section 8(c)(3) of RESPA, 12 U.S.C. § 2607(c)(3), provides that Section 8 does not prohibit "payments pursuant to cooperative brokerage and referral arrangements or agreements between real estate agents and brokers." Regulation X restates that carve-out at 12 C.F.R. § 1024.14(g)(1)(v), but with an important limitation: the CFPB rule says the cooperative-brokerage exemption "refers only to fee divisions within real estate brokerage arrangements when all parties are acting in a real estate brokerage capacity," and adds that the exemption "has no applicability" to fee arrangements between real estate brokers and mortgage brokers, or between mortgage brokers. The motion-to-dismiss fight, in other words, is not simply whether a commission split existed. It is whether the alleged payment structure fits inside that brokerage-capacity carve-out — or instead functioned as compensation for mortgage-referral activity, which the regulation expressly says the carve-out does not cover.

The second line of argument, as reported, addresses the elements of a Section 8 claim. Defendants are reported to argue that plaintiffs have not pleaded — at the level required to survive a motion to dismiss — that any specific "thing of value" was given to a specific agent in exchange for a specific referral; that they have not identified an "agreement or understanding" tied to a referral with the necessary specificity; and that they have not identified a "charge paid by them" that was split with someone who did not earn it. Defendants are also reported to argue that some claims fall outside RESPA's one-year limitations period.

The third line of argument, as reported, is procedural. Defendants appear to argue that plaintiffs misidentified or mischaracterized the relevant corporate entities — including, per the complaint, that Veterans United Home Loans is registered as a fictitious name and is wholly owned by Mortgage Research Center, LLC, and that Realty Search Solutions, LLC operates as the Veterans United Realty brokerage rather than as a shell. The motion asks the court either to dismiss the complaint outright or, in the alternative, to require plaintiffs to amend.

What RESPA Section 8 Actually Says

RESPA Section 8 has two prongs. Section 8(a) is the anti-kickback prong: a person may not give and a person may not accept a fee, kickback, or thing of value pursuant to an agreement or understanding for the referral of settlement-service business. Section 8(b) is the anti-fee-splitting prong: a person may not accept any portion of a charge for settlement services other than for services actually performed. Together, the two prongs are intended to prevent the kind of back-channel money movement that, in practice, raises the cost of a real estate closing without the buyer ever seeing why.

Section 8(c) carves out specific arrangements that are not, on their face, prohibited. A bona fide salary or compensation paid for services actually performed. Payments by the seller of real estate to a real estate agent. And — at issue here — Section 8(c)(3) provides that Section 8 does not prohibit "payments pursuant to cooperative brokerage and referral arrangements or agreements between real estate agents and brokers." Regulation X restates that carve-out at 12 C.F.R. § 1024.14(g)(1)(v), but with two important limitations the article should not gloss over. First, the regulation says the exemption "refers only to fee divisions within real estate brokerage arrangements when all parties are acting in a real estate brokerage capacity." Second, the regulation says the exemption "has no applicability" to fee arrangements between real estate brokers and mortgage brokers, or between mortgage brokers. Regulation X also restates the broader rule that "no person shall give and no person shall accept any fee, kickback or other thing of value pursuant to any agreement or understanding, oral or otherwise, that business incident to or part of a settlement service involving a federally related mortgage loan shall be referred to any person." The reach of the cooperative-brokerage carve-out — and whether the alleged Veterans United arrangement fits inside the brokerage-capacity limitation or instead falls outside of it as a fee arrangement involving mortgage-referral activity — is the legal question the motion to dismiss puts to the court.

RESPA Section 8 has been enforced by the CFPB (through administrative actions and consent orders) and by private plaintiffs through the statutory remedy at 12 U.S.C. § 2607(d), which authorizes a private right of action for "three times the amount of any charge paid for such settlement service," together with court costs and reasonable attorneys' fees. As trade publications have reported, settlements of RESPA Section 8 matters in the title-and-settlement-services space have continued through 2026. Whether Peyton survives the motion to dismiss, or is dismissed at the pleading stage, will turn on how the court reads the specific structure plaintiffs describe against the specific text of the cooperative-brokerage carve-out and its limitations.

What the Court Has Not Yet Decided

The motion to dismiss was filed April 13, 2026. The docket identifies it as a motion to dismiss for failure to state a claim and for lack of jurisdiction, with plaintiffs' response due April 27, 2026 unless otherwise ordered. The court has not ruled. No class has been certified. The complaint's allegations remain allegations, and defendants' motion remains argument.

It is also worth being precise about the procedural posture. The motion appears to raise both Rule 12(b)(1) jurisdictional arguments and Rule 12(b)(6) legal-sufficiency arguments. A Rule 12(b)(6) motion generally accepts plaintiffs' well-pleaded factual allegations as true for the purpose of the motion and tests whether those allegations state a plausible claim for relief; a Rule 12(b)(1) jurisdictional challenge can operate differently depending on whether it is a facial challenge (which accepts the allegations as true) or a factual challenge (which permits the court to consider evidence outside the pleadings on the limited question of jurisdiction). A grant of the motion in whole or in part would resolve the legal-sufficiency or jurisdictional question without deciding what really happened on the merits. A denial would mean the case proceeds to discovery, where plaintiffs can attempt to prove their allegations and defendants can attempt to disprove them.

What Counsel for Mortgage Brokers and Lenders Are Watching

For lenders and brokers who structure their relationships with cooperating agents, the Peyton case is the kind of litigation that crystallizes a recurring question: when is an agent network a permissible cooperative-brokerage arrangement, and when is it a Section 8(a) referral-for-fee scheme dressed up in different language? The answer is fact-specific. Cases tend to turn on whether the payment is tied to a specific referral or to broader cooperative work; on whether the receiving party performs identifiable services for the payment; on whether the arrangement is disclosed to the consumer; on whether the payment moves up or down the cooperative chain; and on whether the consumer actually pays more because of the arrangement or simply pays the same.

Two practical implications follow. The first is documentation. A cooperative-brokerage arrangement that is intended to fit within Regulation X's exemption should be documented to show what it is — bona fide cooperative work, services actually performed, compensation untethered from any specific referral. The second is disclosure. Even arrangements that are lawful under RESPA may be exposed to state UDAP claims if they are not adequately disclosed to consumers.

For a Veteran or Other Buyer Reading This

If you are a veteran who used Veterans United Home Loans for a recent purchase, or any homebuyer who used a referral-network lender, several things are worth understanding. The first is that the existence of this lawsuit does not, by itself, mean Veterans United did anything unlawful. The complaint is a set of allegations, and a motion to dismiss is now pending. At this stage, plaintiffs must plead legally sufficient claims; if the case survives dismissal, they will later have to prove their allegations. The court has not adopted them.

The second is that, if your settlement involved an agent who was effectively required to steer you to a particular lender, and you were not told about a back-end commission split, that situation — if proven — is exactly what Section 8 is designed to address. The agencies that historically enforced Section 8 (the CFPB and HUD before it) have brought public matters in the past, and private plaintiffs have brought private matters. Whether you have a viable claim of your own depends on the specifics: the documents in your closing file, the disclosures you signed, and the relationship between the agent and the lender. None of that can be assessed in the abstract.

The third is that VA loans themselves remain a useful tool. Nothing in this case calls into question the underlying program, the entitlement, or the benefits available to qualifying veterans. The dispute is about the structure of one particular lender's agent network and how it interacts with RESPA. The VA loan program is governed by an entirely separate body of statute and regulation.

What Hasn't Been Decided

The motion is pending. Plaintiffs' response was due April 27, 2026 unless the court ordered otherwise. The court has not ruled. No class has been certified. Defendants' factual representations — including their description of Realty Search Solutions, LLC as the operating Veterans United Realty brokerage and their characterization of the cooperative-brokerage carve-out — have not been tested against the discovery record. Plaintiffs' factual allegations — including the alleged 35% commission split, the alleged steering condition, and the alleged lack of disclosure — have not been tested either. The next milestones are predictable: plaintiffs' response, defendants' reply, possible argument, and a decision on the motion that will either narrow the case or end it.

What can be said now is narrow. A federal court in Missouri is being asked to decide whether RESPA's cooperative-brokerage carve-out reaches a national agent network said to operate on an alleged 35% commission-split arrangement, said to be conditioned on lender-loyalty in lead distribution, on the way to a veteran's first home. The answer matters not only for Veterans United, and not only for the three named plaintiffs, but for every lender and every brokerage that has built its business on something that looks, structurally, similar. The court's ruling on the motion to dismiss will not be the end of that question. It will, however, be an early opportunity for a federal court to address this particular alleged structure and to apply Regulation X's brokerage-capacity limitation to it.