A California company that advertised help for distressed mortgage borrowers engaged in discriminatory and illegal practices, the Department of Housing and Urban Development alleged in a press release issued Friday.
Employees and owners of The House Lawyer in Redwood City, Calif., allegedly violated the law by improperly charging Hispanic borrowers for loan modification services and encouraging clients not to pay their mortgages, which put them at risk of foreclosure.
The complaint illustrates that HUD officials are placing equal focus on both
“Today’s action reaffirms HUD’s commitment to ensure that no family is saddled with fraudulent mortgage products that threaten the ability to stay in their home because of their nationality,” said Jeanine Worden, acting assistant secretary for fair housing and equal opportunity, in a press release.
The House Lawyer is charged in HUD’s complaint with violating state law and the Fair Housing Act in its interactions with Hispanic borrowers it reached through advertisements on a Spanish-language radio station.
“THL agents allegedly provided inaccurate information about the application requirements, procedures and standards for review for loan modification requests, and misrepresented that so long as the homeowners withheld their mortgage payments and remained in default, their banks would be compelled to modify their loan,” HUD said in its press release.
HUD plans to bring its complaint before a U.S. administrative law judge unless the parties involved elect to instead have it heard in federal court. They may seek injunctive relief, payment of attorney fees, and civil penalties.
