In 2020, the Consumer Financial Protection Bureau (CFPB) filed a lawsuit against Village Capital & Investment LLC, a mortgage lender, alleging that the company had violated the Consumer Financial Protection Act (CFPA) by misleading veterans about the benefits of refinancing their mortgages.
The CFPB alleged that Village Capital had targeted veterans with deceptive marketing materials that overstated the benefits of refinancing and downplayed the risks. The CFPB also alleged that Village Capital had pressured veterans to refinance their mortgages even when it was not in their best financial interest.
Village Capital denied any wrongdoing, but in 2021, the company agreed to pay a $268,869 civil penalty and to refund $260,000 to consumers to settle the lawsuit. The company also agreed to stop using deceptive marketing materials and to cease pressuring consumers to refinance their mortgages if it is not in their best financial interest.
The Village Capital lawsuit is a reminder that consumers should be careful about refinancing their mortgages and should do their research before choosing a mortgage lender. Consumers should also be wary of deceptive marketing materials and should not be pressured to refinance their mortgages if it is not in their best financial interest.
Here are some specific details about the Village Capital lawsuit:
- The CFPB alleged that Village Capital had violated the CFPA by:
- Misrepresenting the terms and benefits of mortgage refinancing, including the potential savings and costs associated with refinancing.
- Downplaying the risks associated with refinancing, such as the possibility of losing prepayment penalties or having to pay higher interest rates over the life of the loan.
- Pressuring veterans to refinance their mortgages even when it was not in their best financial interest, such as by telling them that they would lose their VA benefits if they did not refinance.
- Village Capital denied any wrongdoing, but in 2021, the company agreed to pay a $268,869 civil penalty and to refund $260,000 to consumers to settle the lawsuit.
- The company also agreed to stop using deceptive marketing materials and to cease pressuring consumers to refinance their mortgages if it is not in their best financial interest.
If you are considering refinancing your mortgage, it is important to do your research and to shop around for the best deal. You should also be wary of deceptive marketing materials and should not be pressured to refinance your mortgage if it is not in your best financial interest.
