HUD Brings Discrimination Charges Against Mortgage Modification Companies

Posted by Patrick Barnard on January 13, 2016 No Comments
Categories : Mortgage Servicing

Three Modesto, Calif., home loan modification companies and nine of their agents are facing discrimination charges from the U.S. Department of Housing and Urban Development (HUD).

HUD alleges that The Home Loan Auditors LLC, Century Law Center LLC and SOE Assistance Center Inc., along with their agents, violated the Fair Housing Act by luring struggling Hispanic homeowners into paying thousands of dollars for home loan audits that the homeowners never received and modification services that had little, if any, value.

The companies allegedly exploited the homeowners' limited-English proficiency and used deceptive marketing in Spanish, at times making false representations, in order to mislead them, HUD says in a press release.

Ultimately, the homeowners lost their properties due to foreclosure.

‘Families struggling to stay in their homes need real help, not false promises that make a bad situation worse,’ says Gustavo Velasquez, assistant secretary for fair housing and equal opportunity for HUD, in a statement. ‘HUD will continue to take appropriate action against individuals and companies that victimize unsuspecting homeowners because of where they come from or the language they speak.’Â Â Â Â Â

The case will be heard by a U.S. administrative law judge unless any party to the charge elects to have the case heard in federal district court.

If an administrative law judge finds after a hearing that discrimination has occurred, he or she may award damages to the complainants for their loss as a result of the discrimination.

The judge may also order injunctive relief and other equitable relief, to deter further discrimination, as well as payment of attorney fees. In addition, the judge may impose civil penalties in order to vindicate the public interest.

If the case is heard in federal court, the judge may also award punitive damages to the complainants.

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