In this episode of the Key Factors podcast, we discuss the recent CFPB fine against Freedom Mortgage for violating RESPA with kickbacks and pay for referrals.
The CFPB found that Freedom Mortgage provided things of value, including subscription services, events, and monthly marketing service agreement payments, to real estate agents and brokers in exchange for referrals of mortgage loans.
This is a serious violation of RESPA, which prohibits kickbacks and other forms of compensation in connection with mortgage lending.
The CFPB fined Freedom Mortgage $1.75 million and ordered the company to stop its unlawful practices.
The CFPB also fined a real estate brokerage firm, Realty Connect, $200,000 for accepting things of value from Freedom Mortgage in exchange for referrals.
This case is a reminder that the CFPB is serious about enforcing RESPA and protecting consumers from illegal kickbacks.
It is also a reminder to mortgage lenders and real estate professionals that they must comply with RESPA and avoid engaging in any prohibited practices.
The penalties in this case are significant, and they should serve as a warning to anyone who is thinking about violating RESPA.
If you are a mortgage lender or real estate professional, you should familiarize yourself with RESPA and its requirements.
You should also seek legal advice if you have any questions about compliance with RESPA.
The CFPB is committed to protecting consumers from illegal kickbacks and other forms of compensation in connection with mortgage lending.
If you believe that you have been the victim of a kickback violation, you should file a complaint with the CFPB.
You can file a complaint online at the CFPB website or by calling 1-855-411-CFPB (2372).
The CFPB will investigate your complaint and take appropriate action if it finds that a violation has occurred.
By working together, we can help to ensure that the mortgage lending market is fair and transparent for all consumers.
**In addition to the above, here are some other things to keep in mind about kickbacks and pay for referrals:
Kickbacks are any payments or other things of value that are given in exchange for referrals of mortgage loans.
Pay for referrals is a type of kickback that involves paying a real estate agent or broker a fee for each mortgage loan that they refer to a mortgage lender.
Kickbacks and pay for referrals are illegal under RESPA.
The CFPB can impose civil penalties on companies that violate RESPA.
Consumers who are the victims of kickback violations can file a complaint with the CFPB.
Guest:
Dylan Shively
James Warren Group
John Hudson
Mortgage Financial Services
Host :
Mark Jones
Co-Founder ReviewMyMortgage
President of iThink Mortgage
NMLS# 513437
Key Factors Podcast is Powered by ReviewMyMortgage.com
Host: Mark Jones | Sr. Loan Officer | NMLS# 513437
If you would like to work with Mark on your next home purchase or as a partner visit iThink Mortgage.
