RoundPoint Mortgage Servicing and Freedom Mortgage – a Match Made in Hell?
The fraud recovery lawyers are investigating mortgage servicing practices at RoundPoint Mortgage Servicing Corporation. According to a recent story in HousingWire, Freedom Mortgage is acquiring RoundPoint through a merger. we didn’t like the merger between Ocwen and PHH and fear this merger will be just as bad for consumers.
RoundPoint is primarily a loan servicer licensed to service residential mortgage loans in 50 states. It has $90 billion in loans being serviced.
Freedom Mortgage is one of the fastest growing nonbank lenders and servicers in the nation. It currently claims to be the fifth largest mortgage lender in the United States. For years, we have spoken with Freedom’s dissatisfied homeowners. Many are vets.
According to a press release, the merger allows Freedom to get more deeply involved in subservicing while RoundPoint will have access to Freedom’s loan origination platform. After the merger is complete, Freedom will be the seventh largest servicer in the U.S.
Why are we concerned with the Freedom Mortgage – RoundPoint Mortgage Servicing merger?
First, bigger is not always better. We have communicated with hundreds of Freedom customers. Homeowners that say they were harassed with robocalls. Vets that say they were tricked into bad VA loan modifications. We even talked to several former Freedom employees who were less than impressed with how the company was run.
The solution to these problems isn’t to make the company bigger. The better solution is to fix the problems or fire senior management. The disease usually isn’t with rank and file workers, it is with the shot callers in the top echelons of the company.
Another concern is the company’s breakneck growth. There is nothing wrong with growing one’s business. A company shouldn’t grow, however, until major problems within the organization are properly addressed.
Is the RoundPoint Mortgage Servicing merger with Freedom Mortgage a repeat of the Ocwen /PHH merger? We simply don’t know. In our opinion, Ocwen and PHH had many unsolved problems. Now that they merged things seem to have gotten worse.
We hope RoundPoint doesn’t head down the same road.
RoundPoint Fraud Claims
Just five months ago, RoundPoint Mortgage Servicing agreed to settle charges involving financial improprieties with force placed insurance. The settlement resolved claims that the Round Point received illegal kickbacks for implementing lender-placed insurance (LPI) policies through Great American E&S Insurance Company.
Like so many other financial services companies, RoundPoint settled the charges without admitting any guilt.
Lender placed insurance, often called force placed insurance, is a terrible scam designed to enrich the lender while often providing terrible insurance coverage. The lender gets a piece of the inflated premiums and the homeowner has better hope there is never a fire or other claim.
There are a ton of lawsuits involving RoundPoint, given their business we expect they will always collect some malcontents.
One complaint that especially disturbed us, however, was filed in Illinois. The plaintiff in that case is Melcina Blanton, a homeowner. After borrowing money to purchase her home in 2009, her loan servicing was transferred to RoundPoint. That is when the nightmare began. Claims that she missed a payment when she says she din’t, requiring her to pay PMI payments twice, and soon, lender placed insurance.
She says for months she was simply given the runaround. Call not answered, a general refusal to help and inconsistent information.
By 2014 she was in default and facing foreclosure and all because of a duplicate PMI payment of $81.00
Despite vague promises of modification, she was defaulted. The foreclosure process began soon thereafter.
Melcina continued to address the matter with the bank. Most struggling homeowners don’t want the hassle of hiring a lawyer. Instead of trying to resolve the mater fairly, RoundPoint’s lawyers told Melcina that she wasn’t allowed to talk to the RoundPoint anymore. Not only that, they told her that they were no obligation to answer her questions.
Finally, they offered her modification. When she refused, they simply stop accepting her checks. That also caused her to sue RoundPoint. Many readers are probably familiar with the same scenario. RoundPoint isn’t the only larger mortgage servicer to face similar accusations.
Fast forward to June 2016 and bank’s lawyer filed the predicable motion to dismiss. Normally, courts rubber stamp those motions allowing the foreclosure to proceed. Not in this case. A federal judge in Illinois found Melcina’s complaints credible and allowed the case to proceed.
MahanyLaw Investigates Robocalls, Harassing Collection Calls, Mortgage Fraud
The fraud recovery lawyers at Mahany Law are interested in speaking with customers of RoundPoint Mortgage Servicing as well as company insiders. We prosecute claims of robocalling, calls made with ringless voicemail, illegal telemarketing calls, improper collection activities and mortgage servicing fraud involving improper fees. (We are unable to help individual homeowners who are in the midst of a foreclosure or modification – seek help from your local bar association in locating a qualified lawyer near you that can help.)
We are already aware of one homeowner claiming they received harassing phone calls from RoundPoint and the successful forced place insurance lawsuit says other misbehavior may be taking place too. Our concern is that these illegal activities may get worse once the merger with Freedom is complete.
Under the Telephone Consumer Protection Act (TCPA), victims of illegal telemarketing calls can receive between $500 to $1500 for each illegal call, text message or ringless voicemail. Federal and many state laws make improper collection calls illegal as well.
There is no obligation or fee for a consultation. If we take your case we get paid on a contingent fee basis meaning we don’t get paid unless you get paid. Cases accepted on a nationwide basis.
RoundPoint insider? All inquiries are protected by the attorney – client privilege and kept strictly confidential. We simply want to help protect homeowners. By helping us know where to look, we can help put an end to illegal behavior. Depending on the misconduct, federal whistleblower rewards may also be available.
To learn more about robocalls, visit our TCPA phone harassment page, How Do I Stop Telemarketing Calls?
Mahany Law – America’s Fraud Recovery Lawyers