fha mortgage loans, local mortgage broker, midwest family lending

(515) 252-7107

APPLY NOW!

Mortgage Industry News

« Return to Mortgage Industry News

Provident Charged with Discrimination on Loans from 2006 to 2011

Tuesday, June 2, 2015

Provident Funding Associates has been charged by two federal agencies with charging higher broker fees to minority borrowers.  The Consumer Financial Protection Bureau (CFPB) and the Department of Justice (DOJ) filed the joint complaint asking the court to require the California lender to pay $9 million in damages to African American and Hispanic borrowers the agencies say were harmed.

Provident originates mortgage loans through a nationwide network of brokers. Last week's complaint alleges that between 2006 and 2011, Provident, which made over 450,000 mortgage loans during the period, set base or par rates for its various loan products reflecting the company's assessment of individual applicant creditworthiness, current interest rates, and what investors were willing to pay for the loans.  These rates were published on sheets provided to brokers who were also given schedules of yield spread premiums (YSP) Provident would pay brokers who originated higher priced loans.  The fees paid to Provident's brokers were thus made up of two components: payments by Provident from increased interest revenue and from the direct fees paid by the borrower.

 

Read Full Article

Testimonial

Molly was extremely helpful and available to us to walk us through each part of the process. She went above and beyond. I’ve bought two houses before and couldn’t tell you the names of our loan people. Molly was unforgettable with her customer service.
Erin C.