[Federal Register Volume 86, Number 28 (Friday, February 12, 2021)]
[Notices]
[Pages 9360-9366]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-02921]
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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
[Docket No. FR-6246-N-01]
Mortgagee Review Board: Administrative Actions
AGENCY: Office of the Assistant Secretary for Housing--Federal Housing
Commissioner, HUD.
ACTION: Notice.
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SUMMARY: In compliance with Section 202(c)(5) of the National Housing
Act, this notice advises of the cause and description of administrative
actions taken by HUD's Mortgagee Review Board against HUD-approved
mortgagees.
FOR FURTHER INFORMATION CONTACT: Nancy A. Murray, Secretary to the
Mortgagee Review Board, 451 Seventh Street SW, Room B-133/3150,
Washington, DC 20410-8000; telephone (202) 402-2701 (this is not a
toll-free number). Persons with hearing or speech impairments may
access this number through TTY by calling the toll-free Federal
Information Service at (800) 877-8339.
SUPPLEMENTARY INFORMATION: Section 202(c)(5) of the National Housing
Act (12 U.S.C. 1708(c)(5)) requires that HUD ``publish a description of
and the cause for administrative action against a HUD-approved
mortgagee'' by HUD's Mortgagee Review Board (``Board''). In compliance
with the requirements of Section 202(c)(5), this notice advises of
actions that have been taken by the Board in its meetings from the
beginning of the FY 20 fiscal year, October 1, 2019, through September
30, 2020 where settlement agreements have been reached or notices of
administrative actions (withdrawals) have been issued.
I. Civil Money Penalties, Withdrawals of FHA Approval, Suspensions,
Probations, and Reprimands
1. 1st Financial Inc., Millersville, MD [Docket No. 19-2038-MR]
Action: On May 12, 2020, the Board voted to enter into a settlement
agreement with 1st Financial Inc. (``1st Financial'') that included a
civil money penalty of $14,819. The settlement did not constitute an
admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of HUD requirements: 1st Financial (a) failed to notify HUD
of a state sanction during fiscal year 2018; and (b) submitted a false
certification to HUD concerning 1st Financial's fiscal year 2018. The
settlement does not constitute an admission of liability or fault.
2. A1 Mortgage Group LLC, Lees Summit, MO [Docket No. 18-1908-MR]
Action: On June 26, 2019, the Board voted to withdraw the FHA
approval of A1 Mortgage Group LLC (``A1 Mortgage'') for a period of one
year.
Cause: The Board took this action based on the following alleged
violations of HUD requirements: A1 Mortgage (a) failed to maintain the
minimum required adjusted net worth in fiscal year 2017; and (b)
submitted a false certification to HUD concerning A1 Mortgage's fiscal
year 2017.
3. Access Capital Funding, LLC, Chesterfield, MO [Docket No. 19-2050-
MR]
Action: On December 17, 2019, the Board voted to enter into a
settlement agreement with Access Capital Funding, LLC (``Access
Capital'') that included a civil money penalty of $5,000. The
settlement did not constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violation of HUD requirements: Access Capital failed to maintain the
minimum required adjusted net worth in fiscal year 2018.
4. Acre Mortgage & Financial Inc., Marlton, NJ [Docket No. 19-1951-MR]
Action: On December 17, 2019, the Board voted to enter into a
settlement agreement with Acre Mortgage & Financial Inc. (``Acre
Mortgage'') that included a civil money penalty of $32,123 and the
indemnification of two FHA-insured loans that had not yet resulted in
an insurance claim with one for a period of five years and the second
for the life of the loan. The settlement does not constitute an
admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of HUD requirements: Acre Mortgage (a) failed to ensure
HUD's new construction requirements were met; (b) failed to ensure that
HUD's self-employment income requirements were met; (c) failed to
maintain the minimum required adjusted net worth in fiscal
[[Page 9361]]
year 2018; (d) failed to timely report the failure to maintain the
required minimum adjusted net worth in fiscal year 2018; (e) failed to
report an operating loss exceeding 20% of its net worth in fiscal year
2018; and (f) failed to file quarterly financial statements after an
operating loss exceeding 20% of its net worth in fiscal year 2018.
5. American Nationwide Mortgage Company, Inc., Tampa, FL [Docket No.
20-2012-MR]
Action: On September 1, 2020, the Board voted to enter into a
settlement agreement with American Nationwide Mortgage Company, Inc.
(``American Nationwide'') that included a civil money penalty of
$19,468. The settlement does not constitute an admission of liability
or fault.
Cause: The Board took this action based on the following alleged
violations of HUD requirements: American Nationwide (a) failed to
notify HUD of sanctions in fiscal years 2016, 2018, and 2019; and (b)
submitted false certifications to HUD concerning American Nationwide's
fiscal years 2016 and 2018.
6. Aspire Lending, Dallas, TX [Docket No. 19-2051-MR]
Action: On May 12, 2020, the Board voted to enter into a settlement
agreement with Aspire Lending (``Aspire'') that included a civil money
penalty of $5,000. The settlement does not constitute an admission of
liability or fault.
Cause: The Board took this action based on the following alleged
violation of HUD requirements: Aspire failed to maintain the minimum
required adjusted net worth during fiscal year 2018.
7. Atlantic Pacific Mortgage Corporation, Mount Laurel, NJ [Docket No.
19-1950-MR]
Action: On December 17, 2019, the Board voted to withdraw the FHA
approval of Atlantic Pacific Mortgage Corporation (``Atlantic
Pacific'') for a period of three years and to file a complaint for
$99,000 in civil money penalties.
Cause: The Board took this action based on the following alleged
violations of HUD requirements: Atlantic Pacific (a) failed to timely
submit acceptable audited financial statement(s) and supplementary
reports concerning fiscal year 2018; (b) failed to properly calculate
the borrowers' debts for three FHA-insured loans; (c) failed to
properly calculate the borrowers' income for three FHA-insured loans;
(d) failed to properly document the source/adequacy of funds used for
the down payment or closing costs for one FHA-insured loan; (e) failed
to properly document acceptable credit history for one FHA-insured
loan; and (f) failed to ensure the property met HUD's minimum property
requirements for two FHA-insured loans.
8. Banc of California, NA dba Banc Home Loans, Santa Ana, CA [Docket
No. 18-1855-MR]
Action: On July 16, 2020, the Board voted to enter into a
settlement agreement with Banc of California that included a civil
money penalty of $350,000, the refund to borrowers of improperly
assessed fees, the submission of its Quality Control Plan for HUD's
review and approval, and the indemnification of FHA-insured loans that
had not yet resulted in an insurance claim, ten for a term of five
years and fourteen for the life of the respective loan. The settlement
does not constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of HUD requirements: Banc of California (a) maintained a
Quality Control Plan that failed to meet HUD's requirements; (b) failed
to properly document gift funds; (c) failed to accurately calculate,
analyze and document borrower income; (d) failed to properly document
loan binders; (e) charged borrowers unallowable or excessive fees; (f)
endorsed loans late without the required lender certifications; (g)
failed to reconcile discrepancies between loan files and data in FHA
Connection; (h) maintained case binders with missing, unsigned, or
inaccurate Closing Disclosures, HUD-1 Settlement Statements, Settlement
Certificates and Addenda to the HUD-1; (i) failed to obtain
satisfactory mortgage or rental verification; (j) failed to document
verification of borrowers against CAIVRS, the Limited Denial of
Participation list and General Services Administration list as
required; (k) failed to obtain a current mortgage payoff statement; (l)
failed to resolve discrepancies in a borrower's social security number;
and (m) failed to retain required forms in the case binder.
9. Bay-Valley Mortgage Group, Garden Grove, CA [Docket No. 20-2004-MR]
Action: On September 1, 2020, the Board voted to enter into a
settlement agreement with Bay-Valley Mortgage Group that included a
civil money penalty of $9,819. The settlement does not constitute an
admission of liability or fault.
Cause: The Board took this action based on the following alleged
violation of HUD requirements: Bay-Valley Mortgage Group failed to
timely notify HUD of a sanction in fiscal year 2019.
10. BNB Financial Inc., Glendale, CA [Docket No. 20-2006-MR]
Action: On September 1, 2020, the Board voted to enter into a
settlement agreement with BNB Financial (``BNB Financial'') that
required BNB Financial to pay a civil money penalty in the amount of
$5,000. The settlement does not constitute an admission of liability or
fault.
Cause: The Board took this action based on the following alleged
violation of HUD requirements: BNB failed to maintain the minimum
required adjusted net worth in fiscal year 2019.
11. CBC Mortgage Agency dba Chenoa, South Jordan, UT [Docket No. 20-
2043-MR]
Action: On May 12, 2020, the Board voted to enter into a settlement
agreement with CBC Mortgage Agency (``CBC Mortgage'') that included a
civil money penalty of $12,000. The settlement does not constitute an
admission of liability or fault.
Cause: The Board took this action based on the following alleged
violation of HUD requirements: CBC Mortgage falsely advertised its down
payment assistance program as ``HUD approved.''
12. Centralbanc Mortgage Corporation, Bellevue, WA [Docket No. 20-2010-
MR]
Action: On September 1, 2020, the Board voted to enter into a
settlement agreement with Centralbanc Mortgage Corporation
(``Centralbanc'') that included a civil money penalty of $14,189. The
settlement does not constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of HUD requirements: Centralbanc (a) failed to timely notify
HUD of a state sanction in its fiscal year 2018; and (b) submitted a
false certification to HUD concerning Centralbanc's fiscal year 2018.
13. Columbus Capital Lending, LLC, Miami, FL [Docket No. 19-2032-MR]
Action: On December 17, 2019, the Board voted to enter into a
settlement agreement with Columbus Capital Lending, LLC (``Columbus
Capital'') that included a civil money penalty of $10,000. The
settlement does not constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of HUD requirements: Columbus Capital (a) failed to maintain
[[Page 9362]]
the minimum required liquid assets in fiscal year 2018; and (b) failed
to timely report the failure to maintain the minimum required liquid
assets in fiscal year 2018.
14. CommonFund Mortgage Corporation, Syracuse, NY [Docket No. 19-2026-
MR]
Action: On May 12, 2020, the Board voted to enter into a settlement
agreement with CommonFund Mortgage Corporation (``CommonFund'') of
payment of civil money penalties of $14,819. The settlement does not
constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of HUD requirements: CommonFund (a) failed to notify HUD of
a sanction in fiscal year 2018; and (b) submitted a false certification
to HUD concerning CommonFund's fiscal year 2018.
15. Cooperativa de Ahorro y Credito de Aguada, Aguada, PR [Docket No.
19-2024-MR]
Action: On December 17, 2019, the Board voted to withdraw the FHA
approval of Cooperativa de Ahorro y Credito de Aguada for a period of
one year.
Cause: The Board took this action based on the following alleged
violation of HUD requirements: Cooperativa de Ahorro y Credito de
Aguada failed to maintain the minimum required adjusted net worth in
fiscal year 2018.
16. Cooperativa de Ahorro y Cr[eacute]dito de Rinc[oacute]n,
Rinc[oacute]n, PR [Docket No. 19-2023-MR]
Action: On May 12, 2020, the Board voted to enter into a settlement
agreement with Cooperativa de Ahorro y Credito de Rinc[oacute]n
(``Rinc[oacute]n'') that included a civil money penalty of $10,000. The
settlement does not constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of HUD requirements: Rinc[oacute]n (a) failed to maintain
the minimum required adjusted net worth in fiscal year 2018; and (b)
failed to timely report the failure to maintain the required minimum
adjusted net worth in fiscal year 2018.
17. Credence Funding Corporation, Aberdeen, MD [Docket No. 18-1873-MR]
Action: On May 12, 2020, the Board voted to enter into a settlement
agreement with Credence Funding Corporation that included a civil money
penalty of $9,819. The settlement does not constitute an admission of
liability or fault.
Cause: The Board took this action based on the following alleged
violations of HUD requirements: Credence Funding Corp (a) failed to
maintain the minimum required adjusted net worth in fiscal year 2018;
and (b) failed to timely report the failure to maintain the required
minimum adjusted net worth in fiscal year 2018.
18. DHA Financial LLC, Greenwood Village, CO [Docket No. 19-1954-MR]
Action: On December 17, 2019, the Board voted to withdraw the FHA
approval of DHA Financial LLC (``DHA'') for a period of one year.
Cause: The Board took this action based on the following alleged
violations of HUD requirements: DHA (a) failed to maintain the minimum
required adjusted net worth in fiscal year 2018; and (b) failed to
maintain the minimum required adjusted net worth in fiscal year 2019.
19. Directors Mortgage, Inc., Lake Oswego, OR [Docket No. 19-2043-MR]
Action: On December 17, 2019, the Board voted to enter into a
settlement agreement with Directors Mortgage, Inc. that included a
civil money penalty of $5,000. The settlement does not constitute an
admission of liability or fault.
Cause: The Board took this action based on the following alleged
violation of HUD requirements: Directors Mortgage failed to timely
notify HUD of a sanction in fiscal year 2018.
20. Dwight Capital LLC, New York, NY [Docket No. 20-2077-MR]
Action: On July 16, 2020, the Board voted to impose a civil money
penalty of $1,081,780 against Dwight Capital LLC (``Dwight Capital''),
which was included as part of a subsequent settlement agreement along
with a requirement that Dwight Capital provide a plan to HUD to address
staffing levels in relation to its loan volume. The settlement does not
constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of HUD requirements: Dwight Capital (a) promoted an
individual to Chief Underwriter without HUD approval, in violation of
the MAP Guide; and (b) had two individuals concurrently designated as
Chief Underwriter in violation of the MAP Guide.
21. Endeavor Capital, LLC, Chesterfield, MO [Docket No. 19-2008-MR]
Action: On May 12, 2020, the Board voted to enter into a settlement
agreement with Endeavor Capital, LLC (``Endeavor'') that included a
civil money penalty payment of $5,000. The settlement does not
constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violation of HUD requirements: Endeavor failed to report an operating
loss exceeding 20% of its net worth in fiscal year 2018.
22. Evesham Mortgage LLC dba 3rd Generation Mortgages, Marlton, NJ
[Docket No. 19-1948-MR]
Action: On December 17, 2019, the Board voted to enter into a
settlement agreement with Evesham Mortgage LLC dba 3rd Generation
Mortgages (``Evesham'') that included a civil money penalty of $37,872
and the indemnification of four FHA-insured loans that had not yet
resulted in an insurance claim, three for a term of five years and the
fourth for the life of the loan. The settlement does not constitute an
admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of HUD requirements: Evesham (a) failed to properly document
the source and adequacy of funds used to close an FHA insured loan; (b)
failed to properly document a borrower's employment; (c) failed to
properly calculate the monthly obligation of a borrower's student loan
debt; and (d) failed to document that a borrower met the net self-
sufficiency rental income test for a three-unit property.
23. EZ Fundings, Inc., Rancho Cucamonga, CA [Docket No. 19-2052-MR]
Action: On May 12, 2020, the Board voted to enter into a settlement
agreement with EZ Fundings, Inc. (``EZ Fundings'') that included a
civil money penalty of $5,000. The settlement does not constitute an
admission of liability or fault.
Cause: The Board took this action based on the following alleged
violation of HUD requirements: EZ Fundings failed to timely notify HUD
of a state sanction in fiscal year 2018.
24. Finance of America Reverse, LLC, Tulsa, OK [Docket No. 20-0028-FC]
Action: On January 8, 2020, the Board voted to approve two
settlement agreements with Finance of America Reverse, LLC (``FAR'')
that included a $500,000 payment to resolve allegations under the
Program Fraud Civil
[[Page 9363]]
Remedies Act and a $1,970,000 payment to resolve allegations under the
False Claims Act. The settlements do not constitute an admission of
liability or fault.
Cause: The Board took this action based on the following alleged
violations of HUD requirements: A mortgagee for which FAR was the
successor-in-interest provided appraisers with information to
improperly influence the appraised values of properties that
subsequently secured FHA-insured mortgages.
25. Forthright Funding Corporation, Scottsdale, AZ [Docket No. 19-2027-
MR]
Action: On May 12, 2020, the Board voted to enter into a settlement
agreement with Forthright Funding Corporation (``Forthright'') that
included a civil money penalty of $15,000. The settlement does not
constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of HUD requirements: Forthright (a) failed to maintain the
minimum required adjusted net worth in fiscal year 2018; (b) failed to
timely report the failure to maintain the required minimum adjusted net
worth in fiscal year 2018; (c) failed to report an operating loss
exceeding 20% of its net worth in fiscal year 2018; and (d) failed to
file quarterly financial statements after an operating loss exceeding
20% of its net worth in fiscal year 2018.
26. Geauga Savings Bank, Beachwood, OH [Docket No. 19-2018-MRT]
Action: On June 26, 2019, the Board voted to withdraw the FHA
approval of Geauga Savings Bank (``Geauga'') for a period of one year.
Geauga appealed the withdrawal and, as part of a settlement, the Board
rescinded the Notice of Violation such that HUD imposed neither
administrative action nor a civil money penalty against Geauga and
Geauga remained an FHA-approved lender. The settlement agreement does
not constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violation of HUD requirements: Geauga failed to timely meet the
requirements for annual recertification of its FHA approval.
27. Global Bancorp dba Versailles Property, Irvine, CA [Docket No. 19-
1931-MR]
Action: On December 17, 2019, the Board voted to withdraw Global
Bancorp dba Versailles Property (``Global'') for a period of one year.
Global appealed the withdrawal, but voluntarily withdrew the appeal on
November 12, 2020.
Cause: The Board took this action based on the following alleged
violations of HUD requirements: Global (a) failed to maintained the
minimum required adjusted net worth in fiscal year 2017; (b) failed to
maintained the minimum required adjusted net worth in fiscal year 2018;
(c) failed to maintain the minimum required liquid assets in fiscal
year 2018; (d) failed to timely report the failure to maintain the
required minimum adjusted net worth and liquid assets in fiscal year
2018; and (e) submitted a false certification to HUD concerning
Global's fiscal year 2017.
28. Guaranteed Rate Inc., Chicago, IL [Docket No. 20-2068-MR]
Action: On January 8, 2020, the Board voted to authorize a
settlement with Guaranteed Rate Inc. (``GRI'') that would ultimately
include a payment of $15,060,000 to resolve allegations made under the
False Claims Act. The settlement does not constitute an admission of
liability or fault.
Cause: The Board took this action based on the following alleged
violations of HUD requirements: GRI (a) compensated underwriters with
impermissible commissions; (b) failed to comply with the self-reporting
requirements for endorsed loans that were not eligible for endorsement;
and (c) employed individuals who engaged in conduct designed to cause
the endorsement of loans not eligible for endorsement.
29. Hallmark Home Mortgage, LLC, Fort Wayne, IN [Docket No. 19-1938-MR]
Action: On December 17, 2019, the Board voted to enter into a
settlement agreement with Hallmark Home Mortgage LLC (``Hallmark'')
that included a civil money penalty of $9,000. The settlement does not
constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of HUD requirements: Hallmark (a) failed to report an
operating loss exceeding 20% of its net worth in fiscal year 2018; and
(b) failed to file quarterly financial statements after an operating
loss exceeding 20% of its net worth in fiscal year 2018.
30. Idaho Central Credit Union, Pocatello, ID [Docket No. 19-2034-MR]
Action: On September 1, 2020, the Board voted to enter into a
settlement agreement with Idaho Central Credit Union (``Idaho
Central'') that included a civil money penalty of $5,000. The
settlement does not constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violation of HUD requirements: Idaho Central failed to notify HUD of a
change to its business structure in fiscal year 2018.
31. Ideal Home Loans, LLC, Denver, CO [Docket No. 19-2009-MR]
Action: On May 12, 2020, the Board voted to enter into a settlement
agreement with Ideal Home Loans, LLC (``Ideal'') that included a civil
money penalty of $14,819. The settlement does not constitute an
admission of liability or fault.
Cause: The Board voted to accept this offer based on the following
alleged violations of HUD requirements. Ideal: (a) Failed to maintain
the minimum required adjusted net worth in fiscal year 2018; (b) failed
to maintain the minimum required liquid assets in fiscal year 2018; and
(c) failed to timely report the failure to maintain the minimum
required liquid assets in fiscal year 2018.
32. JNC Mortgage Company, Inc., El Paso, TX [Docket No. 19-2021-MR]
Action: On December 17, 2019, the Board voted to enter into a
settlement agreement with JNC Mortgage Company, Inc. (``JNC Mortgage'')
that included a civil money penalty of $14,319. The settlement does not
constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of HUD requirements: JNC Mortgage (a) failed to timely
notify HUD of state sanction in fiscal year 2018; and (b) submitted a
false certification to HUD concerning JNC Mortgage's fiscal year 2018.
33. Lenox Financial Mortgage Corporation, Santa Ana, CA [Docket No. 19-
1971-MR]
Action: On December 17, 2019, the Board voted to enter into a
settlement agreement with Lenox Financial Mortgage Corporation
(``Lenox'') that included a civil money penalty of $4,500. The
settlement does not constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violation of HUD requirements: Lenox failed to maintain the minimum
required adjusted net worth in fiscal year 2017.
[[Page 9364]]
34. Lenox Financial Mortgage Corporation, Santa Ana, CA [Docket No. 20-
2008-MR]
Action: On May 12, 2020, the Board voted to enter into a settlement
agreement with Lenox that included a civil money penalty of $10,000.
The settlement does not constitute an admission of liability or fault.
Cause: The Board took this action on the basis of the following
violations of HUD requirements. Lenox (a) failed to timely notify FHA
of an operating loss exceeding 20% of its net worth during its fiscal
year 2018; and (b) failed to file quarterly financial statements after
an operating loss exceeding 20% of its net worth in fiscal year 2018.
35. Midwest Equity Mortgage, LLC nka Celebrity Home Loans, LLC,
Oakbrook Terrace, IL [Docket No. 19-2029-MR]
Action: On May 20, 2020, the Board voted to impose a civil money
penalty of $15,000 against Midwest Equity Mortgage, LLC (``Midwest
Equity''), which was included in a subsequent settlement agreement. The
settlement does not constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of HUD requirements: Midwest Equity (a) failed to report an
operating loss exceeding 20% of its net worth in the third quarter of
fiscal year 2018; (b) failed to report an operating loss exceeding 20%
of its net worth in the fourth quarter of fiscal year 2018; and (c)
failed to notify HUD of a change to its business structure in fiscal
year 2018.
36. Mortgage Capital Associates, Los Angeles, CA [Docket No. 20-2070-
MR]
Action: On December 17, 2019, the Board voted to withdraw the FHA
approval of Mortgage Capital Associates (``Mortgage Capital'') for a
period of one year.
Cause: The Board took this action based on the following alleged
violation of HUD requirements: Mortgage Capital failed to timely notify
HUD of a sanction in fiscal year 2019.
37. Mortgage Now Inc., Shrewsbury, NJ [Docket No. 19-1918-MR]
Action: On December 17, 2019, the Board voted to impose a civil
money penalty of $9,623 against Mortgage Now Inc. (``Mortgage Now''),
which was included in a subsequent settlement agreement. The settlement
does not constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of HUD requirements: Mortgage Now (a) failed to maintain the
minimum required adjusted net worth in fiscal year 2017; (b) failed to
timely report the failure to maintain the required minimum adjusted net
worth in fiscal year 2017; and (c) failed to timely notify HUD of a
sanction in fiscal year 2017.
38. Mortgage Unlimited, LLC, Garfield, NJ [Docket No. 19-2039-MR]
Action: On May 12, 2020, the Board voted to enter into a settlement
agreement with Mortgage Unlimited, LLC (``Mortgage Unlimited'') that
included a civil money penalty of $9,819. The settlement does not
constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of HUD requirements: Mortgage Unlimited (a) failed to report
an operating loss exceeding 20% of its net worth in fiscal year 2018;
and (b) failed to file quarterly financial statements after an
operating loss exceeding 20% of its net worth in fiscal year 2018.
39. myCUmortgage, LLC, Beavercreek, OH [Docket No. 19-2045-MR]
Action: On December 17, 2019, the Board voted to assess a civil
money penalty of $5,000 against myCUmortgage, LLC (``myCUmortgage''),
which was included in a subsequent settlement agreement. The settlement
does not constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violation of HUD requirements: myCUmortgage failed to timely notify HUD
of a sanction in fiscal year 2018.
40. NOVA Financial & Investment Corporation, Tucson, AZ [Docket No. 20-
2023-MR]
Action: On May 12, 2020, the Board voted to enter into a settlement
agreement with NOVA Financial & Investment Corporation (``NOVA
Financial'') that included both an indemnification payment to HUD of
$752,518 to indemnify HUD for seven loans that resulted in a claim for
FHA insurance and the indemnification of an eighth loan that had not
yet resulted in an insurance claim, for the life of the loan. The
settlement does not constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violation of HUD requirements: NOVA Financial violated FHA requirements
by endorsing or causing to be endorsed FHA-insurance eight FHA-insured
loans that were not eligible for endorsement due to the actions of a
criminal fraud scheme involving a now-former loan officer that relied
on fraudulent gift letters and gift funds.
41. Obsidian Financial Services, Inc., Melbourne, FL [Docket No. 19-
2023-MR]
Action: On December 17, 2019, the Board voted to enter into a
settlement agreement with Obsidian Financial Services, Inc.
(``Obsidian'') that included a civil money penalty of $28,942. The
settlement does not constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of HUD requirements: Obsidian (a) failed to timely notify
HUD of a sanction in fiscal year 2017; (b) submitted a false
certification to HUD concerning Obsidian's fiscal year 2017; (c) failed
to timely notify HUD of a sanction in fiscal year 2018; and (d)
submitted a false certification to HUD concerning Obsidian's fiscal
year 2018.
42. Omega Financial Services Inc., Union, NJ [Docket No. 19-2048-MR]
Action: On May 12, 2020, the Board voted to enter into a settlement
agreement with Omega Financial Services (``Omega'') that included a
civil money penalty of $9,819. The settlement does not constitute an
admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of HUD requirements: Omega (a) failed to maintain the
minimum required liquid assets in fiscal year 2018; and (b) failed to
timely report the failure to maintain the minimum required liquid
assets in fiscal year 2018.
43. Panorama Mortgage Group LLC, Las Vegas, NV [Docket No. 19-2015-MR]
Action: On December 17, 2019, the Board voted to enter into a
settlement agreement with Panorama Mortgage Group LLC (``Panorama'')
that included a civil money penalty of $19,936. The settlement does not
constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of HUD requirements: Panorama (a) failed to ensure that all
objections to title were cured with respect to one FHA-insured loan;
(b) failed, with respect to one FHA-insured loan, to verify and
determine the delinquency status of a federal non-tax debt; and (c)
improperly charged a borrower a utility fee not permitted under a
purchase contract.
[[Page 9365]]
44. Paragon Mortgage Corporation, Phoenix, AZ [Docket No.: 19-2028-MR]
Action: On May 12, 2020, the Board voted to enter into a settlement
agreement with Paragon Mortgage Corporation (``Paragon'') that included
a civil money penalty of $29,457. The settlement does not constitute an
admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of HUD requirements: Paragon (a) failed to maintain the
minimum required adjusted net worth in fiscal year 2018; (b) failed to
timely report the failure to maintain the required minimum adjusted net
worth in fiscal year 2018; (c) failed to maintain the minimum required
liquid assets throughout fiscal year 2018; and (d) failed to timely
report the failure to maintain the minimum required liquid assets in
fiscal year 2018; (e) failed to report an operating loss exceeding 20%
of its net worth in fiscal year 2018; and (f) failed to file quarterly
financial statements after an operating loss exceeding 20% of its net
worth in fiscal year 2018.
45. Parkside Lending, LLC, San Francisco, CA [Docket No. 20-2028-MR]
Action: On May 12, 2020, the Board voted to enter into a settlement
agreement with Parkside Lending, LLC (``Parkside'') for a civil money
penalty of $10,000. The settlement does not constitute an admission of
liability or fault.
Cause: The Board took this action based on the following alleged
violation of HUD requirements: Parkside failed to timely notify HUD of
two state sanctions in fiscal years 2017 and 2018.
46. Prime Choice Funding, Inc., Tustin, OK [Docket No. 19-1954-MR]
Action: On December 17, 2019, the Board voted to enter into a
settlement agreement with Prime Choice Funding (``Prime Choice'') that
included a civil money penalty of $37,442. The settlement does not
constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of HUD requirements: Prime Choice (a) failed to report an
operating loss exceeding 20% of its net worth in fiscal year 2018; (b)
failed to file quarterly financial statements after an operating loss
exceeding 20% of its net worth in fiscal year 2018; (c) failed to
timely notify HUD of a sanction in fiscal year 2018; (d) submitted a
false certification to HUD concerning Prime Choice's fiscal year 2018;
(e) failed to timely notify HUD of a sanction in fiscal year 2017; and
(f) submitted a false certification to HUD concerning Prime Choice's
fiscal year 2017.
47. RMS Associates, Las Vegas, NV [Docket No. 20-2002-MR]
Action: On December 17, 2019, the Board voted to enter into a
settlement agreement with RMS Associates (``RMS'') that included a
civil money penalty of $14,819. The settlement does not constitute an
admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of HUD requirements: RMS (a) failed to timely notify HUD of
a sanction in fiscal year 2018; and (b) submitted a false certification
to HUD concerning RMS's fiscal year 2018.
48. Ross Mortgage Company, Inc., Westborough, MA [Docket No. 19-1974-
MR]
Action: On May 12, 2020, the Board voted to accept a settlement
agreement with Ross Mortgage Company (``Ross Mortgage'') that included
a civil money penalty of $19,442.
Cause: The Board took this action based on the following alleged
violations of HUD requirements: Ross Mortgage (a) failed to maintain
the minimum required adjusted net worth in fiscal year 2017; (b) failed
to timely report the failure to maintain the required minimum adjusted
net worth in fiscal year 2017; and (c) failed to maintain the minimum
required adjusted net worth in fiscal year 2018.
49. Servion, Inc., New Brighton, MN [Docket No. 20-2065-MR]
Action: On September 1, 2020 the Board voted to enter into a
settlement agreement with Servion, Inc. (``Servion'') that included a
civil money penalty of $14,819. The settlement does not constitute an
admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of HUD requirements: Servion (a) failed to timely notify HUD
of a sanction in fiscal year 2018; and (b) submitted a false
certification to HUD concerning Servion's fiscal year 2018.
50. Silvermine Ventures, LLC, Rye Brook, NY [Docket No. 19-2010-MR]
Action: On May 12, 2020, the Board voted to enter into a settlement
agreement with Silvermine Ventures, LLC (``Silvermine'') that included
a civil money penalty of $19,638. The settlement does not constitute an
admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of HUD requirements: Silvermine (a) failed to maintain the
minimum required adjusted net worth in fiscal year 2018; (b) failed to
timely report the failure to maintain the required minimum adjusted net
worth in fiscal year 2018; (c) failed to maintain the minimum required
liquid assets in fiscal year 2018; and (d) failed to timely report the
failure to maintain the minimum required liquid assets in fiscal year
2018.
51. SN Servicing Corporation, Baton Rouge, LA [Docket No. 20-20007-MR]
Action: On May 12, 2020, the Board voted to enter into a settlement
agreement with SN Servicing Corporation (``SN Servicing'') that
included a civil money penalty of $9,819. The settlement does not
constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violation of HUD requirements: SN Servicing failed to timely notify HUD
of a sanction in fiscal year 2019.
52. Springboard CDFI dba Springboard Mortgage Collaborative, Riverside,
CA [Docket No. 20-2003-MR]
Action: On May 12, 2020, the Board voted to impose a civil money
penalty of $14,819 against Springboard CDFI dba Springboard Mortgage
Collaborative (``Springboard'') which was included in a subsequent
settlement agreement. The settlement does not constitute an admission
of liability or fault.
Cause: The Board took this action based on the following alleged
violations of HUD requirements: Springboard (a) failed to maintain the
minimum required liquid assets in fiscal year 2018; (b) failed to
timely report the failure to maintain the minimum required liquid
assets in fiscal year 2018; and (c) failed to timely notify HUD of a
sanction in fiscal year 2019.
53. TJC Mortgage, Inc., Birmingham, AL [Docket No. 20-2009-MR]
Action: On May 12, 2020, the Board voted to impose a civil money
penalty of $19,468 against TJC Mortgage, Inc. (``TJC Mortgage''), which
was included in a subsequent settlement agreement. The settlement does
not constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of HUD requirements: TJC Mortgage (a) failed to timely
notify HUD of a sanction in fiscal year 2019; (b) failed to timely
notify HUD of a sanction in fiscal year 2016; and (c) submitted a false
certification to HUD concerning TJC Mortgage's fiscal year 2016.
[[Page 9366]]
54. Tradition Mortgage LLC, Lakeville, MN [Docket No. 19-2049-MR]
Action: On May 12, 2020, the Board voted to enter into a settlement
agreement with Tradition Mortgage LLC, (``Tradition Mortgage'') that
included a civil money penalty of $14,819. The settlement agreement
does not constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violations of HUD requirements: Tradition Mortgage (a) failed to timely
notify HUD of a state sanction in fiscal year 2018; and (b) submitted a
false certification to HUD concerning Tradition Mortgage's fiscal year
2018.
55. United Home Loans, Inc., Westchester, IL [Docket No. 20-2015-MR]
Action: On September 1, 2020, the Board voted to accept a
settlement agreement with United Home Loans, Inc. (``United Home'')
that included a civil money penalty of $5,000. The settlement does not
constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violation of HUD requirements: United Home failed to timely notify HUD
of a sanction in fiscal year 2019.
56. Valley Mortgage Inc., Fargo, ND [Docket No. 19-1956-MR]
Action: On December 17, 2019, the Board voted to enter into a
settlement agreement with Valley Mortgage Inc. (``Valley Mortgage'')
that included a civil money penalty of $9,468 and the indemnification
of one FHA-insured mortgage for a term of five years. The settlement
agreement does not constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violation of HUD requirements: Valley Mortgage violated FHA
underwriting requirements by approving a loan that was not eligible for
FHA insurance by failing to properly calculate the borrowers' effective
income.
57. VIG Mortgage Corporation, San Juan, PR [Docket No. 20-2016-MR]
Action: On May 12, 2020, voted to enter into a settlement agreement
with VIG Mortgage Corporation (``VIG'') that included a civil money
penalty of $4,909. The settlement agreement does not constitute an
admission of liability or fault.
Cause: The Board took this action based on the following alleged
violation of HUD requirements: VIG Mortgage failed to timely notify HUD
of a change to VIG Mortgage's business structure, consisting of a
change in ownership, in fiscal year 2018.
58. Weststar Mortgage Corporation, Albuquerque, NM [Docket No. 20-2005-
MR]
Action: On May 12, 2020, the Board voted to enter into a settlement
agreement with Westar Mortgage Corporation (``Weststar'') that included
a civil money penalty of $5,000. The settlement agreement does not
constitute an admission of liability or fault.
Cause: The Board took this action based on the following alleged
violation of HUD requirements: Weststar failed to timely notify HUD of
a sanction in fiscal year 2019.
II. Lenders That Failed To Timely Meet Requirements for Annual
Recertification of HUD/FHA Approval but Came Into Compliance
Action: The Board entered into settlement agreements with the
following lenders, which required the lender to pay a civil money
penalty without admitting fault or liability.
Cause: The Board took these actions based upon allegations that the
listed lenders failed to comply with HUD's annual recertification
requirements in a timely manner.
The lenders below paid the following civil money penalty amounts:
1. Central Bank and Trust Lander, WY ($10,067) [Docket No. 20-2038-MRT]
The following lenders paid civil money penalties of $5,000.
2. Community Investment Corporation, Chicago, IL [Docket No. 20-2081-
MRT]
3. Great Lakes Financial Group Ltd, Cleveland, OH [Docket No. 20-2090-
MRT]
The following lenders paid civil money penalties of $4,500.
4. Buckeye State Bank, Powell, OH [Docket No. 20-2029-MRT]
5. First Flight Federal Credit Union, Cary, NC [Docket No. 20-2032-MRT]
6. Grand Savings Bank, Grove, OK [Docket No. 20-2034-MRT]
7. SWI Financial Services Inc, Escondido, CA [Docket No. 20-2032-MRT]
8. Windsor Federal Savings [Docket No. 19-2040-MRT]
III. Lenders That Failed To Meet Requirements for Annual
Recertification of HUD/FHA Approval
Action: The Board voted to withdraw the FHA approval of each of the
lenders listed below for a period of one (1) year.
Cause: The Board took this action based upon allegations that the
lenders listed below were not in compliance with HUD's annual
recertification requirements.
1. Apex Lending Inc., Santa Ana, CA
2. Aries Loans Inc., El Segundo, CA
3. City National Bank of New Jersey, Newark, NJ
4. Consumer Loan Services, LLC, La Crosse, WI
5. Gulf Atlantic Funding Group, Davie, FL
6. Metro Phoenix Financial Services, LLC, Phoenix, AZ
7. Mortgage Bank of California, Manhattan Beach, CA
8. South Central Bank and Trust Co., Chicago, IL
9. United Police Federal Credit Union, Miami, FL
Janet M. Golrick,
Acting Assistant Secretary for Housing/FHA Commissioner Chair,
Mortgagee Review Board.
[FR Doc. 2021-02921 Filed 2-11-21; 8:45 am]
BILLING CODE 4210-67-P