Community Federal Savings and Loan Association this week agreed to pay 6 percent on Washington borrowers' funds unnecessarily diverted into escrow accounts, and to reduce the interest rates on the mortgages of those affected by 1/2 percent of a period of 10 years.

The money will be paid in a lump sum or subtracted from future mortgage payments.

The court-approved agreement settles a class action suit initiated by Albert Lawson, who bought a house on Cherry Road NE in 1977. In addition to his monthly mortgage payments, Lawson regularly put money for real estate taxes into an escrow account with Community Federal.

Lawson decided to file suit against Community Federal to recover the funds when he learned District law did not require him to deposit funds in an escrow account because he had made a down payment of at least 20 percent.

His lawyer, real estate attorney Benny Kass, filed on behalf of 150 to 200 Community Federal borrowers who had also paid into escrow accounts between 1974 and 1977.

Orlando W. Darden, president of Community Federal, explained the background of the case by saying neither he nor his counsel was aware of the new District escrow law in 1974, when the S&L was established.

So until Darden learned of it in August 1977, all mortgage borrowers were required to set up escrow accounts. At that time Community Federal immediately began advising current clients in writing of the statute, he said.

However, it did not do so retroactively because, according to Community Federal's lawyer, it would have been too difficult to determine which clients had been told about the law verbally and had agreed to set up escrow accounts anyway, and which had not been told.