DOJ Alleges Discrimination from Loan Modification Service Providers

DOJ Alleges Discrimination from Loan Modification Service Providers

The Justice Department has filed a lawsuit alleging that several mortgage loan modification service providers have violated the federal Fair Housing Act and Equal Credit Opportunity Act by discriminating against Hispanic homeowners. The defendants, The Home Loan Auditors LLC, Century Law Center LLC, SOE Assistance Center Inc., Spieker Law Office, targeted Hispanic homeowners for predatory mortgage loan modification services and impeded the homeowners’ ability to receive financial assistance to maintain their homes. The complaint filed August 23rd, 2016 in the U.S. District Court for the Northern District of California alleges that the defendants marketed and encouraged Hispanic homeowners to pay approximately $5,000 for unnecessary and ineffectual loan audits. The defendants indicated to the homeowners that audits were essential for a loan modification while in fact the audits did not impact the loan modification process and did not provide any financial benefit.

“The defendants told the homeowners that audits were essential for a loan modification, but in fact the audits had no impact on the loan modification process and provided no financial benefit,” DOJ said in a statement, adding that the companies urged clients to stop making mortgage payments and cut contact with lenders, causing many homeowners to default on their mortgages and lose their homes.  “Intentionally targeting any community or person with predatory mortgage services because of their ethnicity or national origin violates federal law, harms working families and hurts our entire economy,” said Principal Deputy Assistant Attorney General Vanita Gupta, head of the Justice Department’s Civil Rights Division.

August 29th, 2016|