“NewDay USA baited veterans and military families into cash-out refinance mortgages by hiding the true costs of these loans,” CFPB director Rohit Chopra said in a statement. “NewDay USA’s misconduct has no place in the VA home loan program.”
This alleged deceptive practice affected more than 3,000 cash-out refinances in states like North Carolina, Maine, and Minnesota, where these comparisons were used extensively.
NewDay USA was keen to emphasize that no veterans, veteran families, or customers of any kind were financially harmed – and as such there was no requirement of restitution. It noted that the agency’s inquiry “focused on a single type of disclosure that was accurately provided to these consumers on a half-dozen other federally mandated disclosures and closing documents.”
Ginnie Mae had previously limited NewDay USA’s ability to package and sell loans to investors, as part of broader efforts to protect veterans from financial harm.
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