[Updated August 2019] We are currently investigating whether mortgage lenders loanDepot and Freedom Mortgage are engaged in faulty underwriting practices in connection with home mortgage loans backed by the U.S. Veterans Administration.
Two clients have reported possible improprieties with both companies.
According to the VA, Freedom Mortgage is the largest VA lender in the United States. Last year 8% of all VA loans were written by Freedom. That equates to 52,816 new loans and doesn’t even include refinancings. There is nothing wrong with being the largest lender but earlier this year, the Justice Department hit the company with $113 million in penalties for underwriting, origination and quality assurance deficiencies in the lender’s FHA loan program. Our client believes there may similar problems on the VA side.
When government backed loans goes into default, it is taxpayer dollars that get spent to make investors whole. Bad loans also mean a greater likelihood that a vet may lose her or his home. Our client says that she was overcharged in certain closing costs, another example of veterans being exploited.
We need to speak to veterans with VA loans and an insider –past or present – from Freedom Mortgage. Our preference is to speak with people who have worked or obtained a VA loan during the last 6 years. To learn more about our Freedom Mortgage investigation, click here.
We are also investigating a potential claim related to loanDepot (also known as Loan Depot). Although only in existence for 6 years, loanDepot is one of the fastest growing lenders in the US. It also part of the new breed of nonbank lenders – loanDepot isn’t a bank and is not subject to the same rules and oversight that banks have.
Last year, a HUD audit of the company’s FHA loan program found problems. Although the audit was limited to Federal Housing Administration loans, we worry that similar underwriting problems are taking place with VA backed loans. Once again, we have a client who reports questionable underwriting practices.
To better evaluate those claims, we are looking to speak with veterans who have obtained a loan from loanDepot during the last 6 years. We also welcome the opportunity to speak with company insiders including past or present underwriters, loan officers or compliance / QC professionals. To learn more about our Loan Depot investigation, click here.
To date, we have clients involved with Freedom Mortgage and loanDepot VA loans. There are plenty of other companies writing these loans, however. The 10 largest VA lenders are (in order): Freedom Mortgage Corp., Quicken Loans Inc., USAA, Wells Fargo, Veterans United Home Loans, Navy Federal Credit Union, SunWest Mortgage Company, Loan Depot, Flagstar Bank and 360 Mortgage Group. We know from other investigations and public reports that Quicken Loans, Wells Fargo and Flagstar have been involved in other reported complaints about their conventional (non-VA) lending. If you have information about any VA loan violations, we hope to speak with you.
As always, all inquiries are completely confidential. We will never use your information without your permission.
August 2019 Update:
VA Loan Scams Investigation on Hold
In May of this year, the Department of Justice and Department of Veteran's Affairs issued subpoenas to a number of mortgage lenders involved in VA lending. Those subpoenas specifically are looking at churning and underwriting.
The VA recently issued new rules for VA loans. As a result, our investigation is now suspended. Of course, you can always contact us to report misconduct. Please note that we handle class action and whistleblower claims only. We do not take individual cases against a lender.