Freedom Mortgage agreed to pay $502,000 to settle claims it violated New Jersey's
The settlement, which was reached with the state in mid-July, alleges that from January 2015 to June 2022, the mortgage lender bombarded consumers with "harassing sales calls about loan refinancing" and engaged in bait-and-switch tactics to induce refinancing. At that time, the lender was headquartered in Mount Laurel, New Jersey. It later moved its operations to Florida.
Additionally, the state claims the company's servicing practices caused consumers financial harm. Freedom allegedly failed to apply consumers' mortgage loan payments in a timely manner, issue prompt escrow refunds and respond to consumer inquiries with accurate information.
During the seven years mentioned, consumers filed over 1,400 complaints with the Better Business Bureau and state entities concerning Freedom's telemarketing practices, according to New Jersey's Division of Consumer Affairs.
"Harassing phone calls from telemarketers aren't just annoying, they're illegal," said New Jersey Attorney General Platkin, in a press release. "This settlement puts a stop to the unlawful and abusive conduct Freedom Mortgage subjected consumers to and puts mechanisms in place for greater accountability and oversight to prevent it from happening again."
Freedom Mortgage did not respond to a request for comment.
The mortgage lender's payment breaks down into $365,200 in civil penalties and $136,800 in reimbursement for the state's investigative costs, according to a consent order between the parties.
Going forward, any consumer complaints received by New Jersey's Division of Consumer Affairs will be forwarded to Freedom for resolution. Additionally, the mortgage shop must designate an employee to serve as the company's complaint coordinator for a period of 18 months to ensure that the lender complies with the consent order.
The coordinator's job will be to provide quarterly updates summarizing additional complaints received or resolved by Freedom Mortgage. The state noted that $50,000 in civil penalties has been squirreled away for now, but will become immediately payable if the mortgage shop fails to comply with settlement terms within the next year.
Local governments and the
However, instances of telemarketing concerns continue to be elevated. Since 2022, at least 65 complaints have been filed in U.S. courts, with leading lenders, including loanDepot and
