On July 24, 2020, the Consumer Financial Protection Bureau (CFPB) announced that it entered consent orders (here and here) against two California-based mortgage lenders, resolving allegations that the lenders violated the Truth in Lending Act (TILA), 15 U.S.C. §§ 1601–1667f, and its implementing regulation, Regulation Z, 12 C.F.R. § 1026.24; the Mortgage Acts and Practices—Advertising Rule (MAP Rule or Regulation N), 12 C.F.R. § 1014.3; and the Consumer Financial Protection Act (CFPA), 12 U.S.C. §§ 5531(a) and 5536(a)(1)(B).
The lenders’ business practices involved marketing Veterans Administration (VA) loans to United States military servicemembers and veterans. The CFPB alleged that the lenders distributed mailers for VA-guaranteed mortgages that contained false, misleading, and inaccurate statements or that lacked proper disclosures. Specifically, the CFPB alleged the lenders, among other things, misrepresented credit terms, used misleading language to described loan terms, misrepresented to consumers their preapproval status, created the false impression the lenders were affiliated with the government, and failed to include disclosures required by Regulation Z.
Under the consent orders, the two lenders will pay civil penalties totaling over $1.1 million. The orders also prohibit the lenders from certain advertising practices related to VA loans and include monitoring and reporting requirements to ensure future compliance.
The post CFPB Announces $1.1 Million Settlement with California-based Lenders to Resolve Allegations of Unfair and Deceptive Practices appeared first on Consumer Finance Insights (CFI).