July and August were not great months for mortgage companies if they’d been caught ripping off military vets and servicemembers. Reg Report reported on one order issued by the consumer financial protection bureau in late August just before we took a week-long break, and wouldn’t you know: the bureau, that week, announced three more companies made subject to fines for their malign activity.
In all, the Consumer Financial Protection Bureau (CFPB) inked seven enforcement orders over the two months against such companies, imposing civil money penalties ranging from $50,000 to $260,000.
The last such action reported by RR was Aug. 26, when the CFPB announced the highest of the penalties against PHLoans.com, Inc. Here’s a brief look at the three additional consent orders announced last week:
- Accelerate Mortgage, LLC was hit with a $225,000 civil money penalty. The CFPB found that this company, which is licensed as a mortgage broker and lender in about 31 states, disseminated advertisements that contained false, misleading, and inaccurate statements or that failed to include required disclosures. “Accelerate advertisements created the false impression that Accelerate was affiliated with the government by using words, phrases, images, or designs that are associated with the VA, Internal Revenue Service, or Federal Deposit Insurance Corporation,” the bureau said. “Accelerate advertisements also falsely represented that the consumer’s access to mortgage-refinance benefits through VA-guaranteed loans was time-limited. The Bureau also found that Accelerate advertisements failed to properly disclose, when required by Regulation Z, credit terms for the advertised mortgage, such as the annual percentage rate of the advertised mortgage or the consumer’s repayment obligations over the full term of the loan.”
- Service 1st Mortgage, Inc., was assessed a $230,000 CMP. The CFPB found that this firm a mortgage broker based in Glen Burnie, Md., that is licensed in about 12 states, in 2015 sent out mailers that advertised VA-guaranteed mortgages that contained false, misleading, and inaccurate statements or that lacked required disclosures. The bureau said the firm, among other things, advertised specific credit terms, such as APRs and hypothetical payment amounts that it was not prepared to offer, or that it could only offer for an introductory period but advertised as if they were permanent loan terms. It said the company also used used terms in millions of its advertisements that falsely represented or implied that Service 1st was affiliated with the government, including the VA, that the advertised product was endorsed, sponsored by, or affiliated with the United States government, or that the United States government was the source of the advertisements.
- Hypotec, Inc., was assessed a $50,000 penalty. This company, a mortgage broker based in Miami, Fla., that is licensed in eight states, also was found by the bureau to have sent false, misleading, and inaccurate statements or that lacked required disclosures. The agency noted activity dating back to 2015.
All three orders provide for injunctive relief to prevent future violations.