Delayed, Harassed and Threatened: Feds Fine Mortgage Servicer $63M
Only $63 mil?
Nationwide mortgage servicing company Green Tree will pay $63 million to settle allegations that it mistreated mortgage holders, federal authorities revealed this week.
Green Tree was accused of misleading consumers about their monthly payments, harassing them if they were as little as one day late, forcing them to making payments using a pricey "Speedpay" system, stalling short sales and not honoring mortgage modifications. The firm will return $48 million to consumers and pay a $15 million civil penalty; it admitted no wrongdoing.
"Green Tree failed consumers who were struggling by prioritizing collecting payments over helping homeowners," said CFPB Director Richard Cordray. "When homeowners in distress had their mortgages transferred to Green Tree, their previous foreclosure relief plans were not maintained. We are holding Green Tree accountable for its unlawful conduct."
Green Tree, based in St. Paul, Minn., has rapidly expanded into the residential mortgage market and services loans for millions of homeowners, in part by buying the rights to service loans from other servicers. The firm was accused of failing to honor mortgage modifications that had been granted to homeowners after it acquired the loans from other financial institutions.
"It's against the law for a loan servicer to lie about the debts people owe, or threaten and harass people about their debts," said Jessica Rich, director of the FTC's Bureau of Consumer Protection. "Working together, the FTC and CFPB are holding Green Tree responsible for mistreating homeowners, including people in financial distress."
Green Tree did not immediately respond to a request for comment from Credit.com. According to the Minneapolis Star Tribune, the firm said it is developing and deploying "best practices."
http://www.msn.com/en-us/money/realestate/delayed-harassed-and-threatened-feds-fine-mortgage-servicer-dollar63m/ar-AAbBvjU
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