- Office of Attorney General Maura Healey
Media Contact for AG Healey Secures $975,000 From Mortgage Company Over Allegations of Unlawful Mortgage Servicing and Debt Collection Practices
BOSTON — A South Carolina mortgage servicing company will pay $975,000 and change its business practices to resolve allegations that the company failed to make required efforts to help homeowners avoid foreclosure and engaged in other unfair debt collection and mortgage servicing practices, Attorney General Maura Healey announced today.
The assurance of discontinuance, filed today in Suffolk Superior Court, alleges that RoundPoint Mortgage Servicing Corporation violated the Massachusetts Act Preventing Unlawful and Unnecessary Foreclosures, codified as “Section 35B”, which requires mortgage servicers to make a good faith effort to help borrowers with certain unfair loan terms avoid foreclosure. The settlement also alleges that RoundPoint violated the Attorney General’s Debt Collection Regulations by failing to timely issue compliant debt validation notices, and calling borrowers more frequently than is legally allowed.
“Homeowners need to be able to count on mortgage companies to provide them with accurate information and take required steps to help prevent foreclosures,” said AG Healey. “Our office is committed to protecting consumers and helping people stay in their homes.”
The AG’s Office alleges that RoundPoint failed, among other things, to conduct necessary analysis under Section 35B by failing to properly assess borrowers’ income, debts and obligations when reviewing for affordable loan modifications, and as such also failed to provide the results of these assessments to borrowers. RoundPoint further failed to provide borrowers with notice of their right to present a counteroffer after being offered a loan modification.
The settlement includes additional allegations that RoundPoint frequently violated the AG’s Debt Collection Regulations, which specify that creditors cannot call more than twice in a seven-day period, and must, within five days of an initial debt collection communication, provide borrowers with notice and opportunity to validate the amount of the debt. RoundPoint harassed borrowers with excessive calls, and failed in thousands of instances to send timely debt validation notices.
In addition to paying $975,000 to the state, RoundPoint will make significant business practice changes and provide ongoing reporting to the AG’s Office to ensure compliance with Massachusetts law and better assist struggling borrowers.
AG Healey has consistently been an advocate for homeowners and sought to ensure that mortgage servicers and other creditors respect the rights of homeowners under state law. The AG’s Office has been a national leader in securing restitution and other relief for borrowers from banks and servicers, including Ditech, PHH, Nationstar, HSBC, Shellpoint Mortgage Servicing, Caliber Home Loans, Bayview, Seterus, Fay Servicing, and others on behalf of Massachusetts homeowners.
This case was handled by Assistant Attorneys General Matthew Lashof-Sullivan and Mercy Cover, both of the AG’s Consumer Protection Division.