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CFPB Goes After 6 VA Lenders for Shady Practices
Friday, September 4, 2020
The Consumer Financial
Protection Bureau (CFPB) has been on a two-month
enforcement tear aimed at mortgage lenders employing deceptive practices in the
VA mortgage lending area. The Bureau has issued consent orders against six
companies since late July in what it terms a "sweep" in response to
concerns about potentially unlawful advertising in the market that the VA
identified. CFPB
found the companies had sent direct-mail advertisements primarily to military
servicemembers and veterans that contained false, misleading, and inaccurate
statements or lacked required disclosures. The complaints set forth similar instances
of violations of the Consumer Financial
Protection Act's (CFPA) prohibition against deceptive
acts and practices, the Mortgage Acts and Practices - Advertising Rule (MAP
Rule), and Regulation Z. The companies are variously accused of using advertisements that misrepresented
advertised loans by stating credit terms that the company was not actually
prepared to offer to the consumer such as describing an introductory interest
rate as fixed when it was instead adjustable.
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