Complaints

Browse articles from all of our Newsletters related to Complaints.

September 15, 2017 - Inside FHA/VA Lending

Legal Experts Suggest Five ‘Fixes’ To Avoid Unfounded FCA Claims

Compliance attorneys are calling for legislative changes to prevent possible misuse of the False Claims Act that could result in settlements that could be financially devastating to mortgage lenders. Concerns about possible government misuse of FCA provisions are evident in the statutory qualifiers that are already embedded in the existing statute, according to a recent analysis by Krista Cooley and Laurence Platt, attorneys and partners in the Washington, DC, office of Mayer Brown. The qualifiers are in the main provision of the FCA that the Department of Justice has used against mortgage lenders and servicers, the attorneys said. The provision imposes liability on any person who “knowingly presents, or causes to be presented, a false or fraudulent claim for payment or approval” or “knowingly makes, uses, or causes to be made or used, a false record or statement material to a false or ...


September 15, 2017 - Inside FHA/VA Lending

Ginnie Mae to Take Action Against Illicit Refinancing of VA Mortgages

Rapid, aggressive refinancing of VA loans has made a comeback with some issuers using strategies to mask the practice and avoid possible penalties, including expulsion from the Ginnie Mae program, according to a top agency official. Responding to concerns raised by Sen. Elizabeth Warren, D-MA, Michael Bright, acting Ginnie Mae president and chief operations officer, said a joint Ginnie Mae/VA lender-abuse task force is analyzing monthly data and developing additional policy measures to deal with the problem. Bright confirmed the resurgence of inappropriate streamline refinancing in Ginnie securitization pools in recent weeks and has promised to crack down on the questionable practice. The problem surfaced last year when Ginnie Mae noticed unusually fast prepayment speeds in its mortgage-backed securities, particularly MBS backed by VA loans. Ginnie found that certain lenders and ...


September 1, 2017 - Inside FHA/VA Lending

Around the Industry

Ginnie Mae Spokesperson Leaves Agency. Cynthia Adcock, director of communications and congressional relations at Ginnie Mae, will no longer be with the agency effective Sept. 4, 2017. Adcock will assume similar duties and responsibilities as a director with the Federal Housing Finance Agency. Michael Huff will handle media inquiries related to Ginnie Mae and congressional matters. FHA Lenders Settle Alleged Violations of FCA, FHA Requirements. The Department of Housing and Urban Development’s Office of the Inspector General recently announced receipt of $44.3 million from separate settlements with two FHA lenders. The settlements resolve allegations of fraudulent claims and violation of FHA requirements against Financial Freedom of Austin, TX, and Prospect Mortgage of Sherman, Oaks, CA. On May 16, 2017, Financial Freedom, an FHA servicer, agreed to pay the ...


August 28, 2017 - Inside the CFPB

Servicer Compliance Coming at the Expense of Borrower Satisfaction

In the age of the CFPB, mortgage servicers have been walking a tightrope, balancing regulatory compliance with borrower satisfaction, sometimes getting stung by an enforcement action. This year, they are falling behind the curve in terms of their customers, according to the results of the 2017 U.S. Primary Mortgage Servicing Satisfaction Study from J.D. Power. “CFPB servicing regulations now in place are resulting in intense scrutiny as well as major fines for some institutions during the first waves of enforcement,” the data, analytics and advisory services provider said. “With other state and federal agencies, such as the Department of Justice and state attorneys generals, also taking actions against mortgage servicers for servicing practices, many experts expect intense regulatory scrutiny to ...


August 18, 2017 - Inside FHA/VA Lending

NYDFS Accuses Veterans United of Overcharging Vets on VA Loans

The Mortgage Research Center, which does business as Veterans United Home Loans and/or VA Mortgage Center, has agreed to pay $1.1 million to New York regulators to resolve allegations of overcharging veterans on loans guaranteed by the Department of Veterans Affairs. Veterans United was the second largest VA lender in the country in the second quarter, with a 5.4 percent share of the VA market, according to the Inside FHA/VA Lending database. The settlement agreement is part of a consent order entered into recently by Veterans United with the New York Department of Financial Services (NYDFS). The settlement stemmed from an investigation which found that the Columbia, MO-based company did not refund “surplus lender credits” on 322 VA loans originated from Jan. 1, 2011, to June 30, 2014. According to the consent order, borrowers obtained a credit from ...


August 18, 2017 - Inside FHA/VA Lending

Wells Fargo, PHH Reach Separate Settlements to Resolve FCA Suits

Wells Fargo and PHH Mortgage have reached separate settlements with the Department of Justice and three other federal agencies to resolve alleged violations of the False Claims Act. The DOJ, Department of Housing and Urban Development, Department of Veterans Affairs and the Federal Housing Finance Agency will rake in $182 million from the settlement of lawsuits involving FHA and VA loans, as well as loans sold to Fannie Mae and Freddie Mac. Wells Fargo denied the allegations in the whistleblower lawsuit but agreed to pay $108 million to resolve the claims. It admitted to no fault or liability. Filed in 2006 and unsealed in 2011, the lawsuit alleged that the bank overcharged veteran borrowers by masking ineligible fees in order to obtain VA guarantees on certain Interest Rate Reduction Refinancing Loans, or streamlined refi mortgages. At the same time, Wells allegedly falsely certified to the VA that it ...


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