Homeowner with a VA Mortgage? Class Investigation for Unlawful Cash-Out Refinancing Practices by Mortgage Lenders

March 11, 2019 – We are looking to speak with homeowners who have refinanced their VA mortgage but have failed to benefit from it. In recent years, some mortgage lenders have engaged in predatory lending tactics toward veterans, causing many to refinance their home loans for large fees that pad lenders’ pockets rather than benefit veterans with better terms or lower costs. If this has happened to you, we want to speak with you.

I refinanced my VA mortgage. What are my rights?

Mortgage lenders must follow the law when working with veterans to refinance their VA mortgage. For example, mortgage lenders must:

  • Provide clear information about the costs of refinancing a VA mortgage, explain how the new loan will benefit the veteran, and limit the amount of the new loan based on the home’s value;
  • Provide homeowners with specific information about how the new loan compares to the existing loan at two different times: when the homeowner applies for refinancing and again at the time of closing;
  • Clearly itemize and explain any fees associated with refinancing; and
  • Not invite you to refinance again for at least six months after closing your new loan.

If your lender failed to notify you of the costs or fees associated with cash-out refinancing, did not explain how your new loan would compare to your existing loan, or has not stopped contacting you with offers, our attorneys may be able to assist you.

How do I know if my mortgage lender is profiting at my expense?

Cash-out mortgage refinances must benefit the homeowner. It is unlawful for a mortgage lender to profit from refinancing your home if you are not benefitting too. Cash-out refinance loans can benefit homeowners under certain circumstances. For example, your new loan might eliminate monthly mortgage insurance, have lower interest rates or lower payments, convert adjustable interest rates to a fixed rate, increase your monthly residual income, fund house repairs or renovations, amount to less than 90 percent of the home’s value, or last for a shorter term. Our attorneys can assist in reviewing your mortgage agreement to assess whether you’re receiving a required benefit.

My lender hid information from me about the costs of refinancing. Now what?

State and federal consumer laws offer protections and remedies against deceptive or abusive lending practices. Our team of consumer protection lawyers continue to seek justice for veterans who cannot battle large corporations alone. Companies that have collected illegal charges or defrauded veterans will generally not refund damages without a fight. These fights are worth having when justice is served. Our proven record of successful class action settlements for consumers is proof that large-scale change can happen, even against the biggest corporations, and that veterans’ rights cannot be sidelined.

Contact Our Minnesota Employment Lawyers
If you are a homeowner and believe your mortgage lender failed to inform you of the costs, fees, or disadvantages of refinancing your VA mortgage, the attorneys of Baillon Thome Jozwiak & Wanta LLP want to hear from you. Please contact us by clicking here or calling 612-252-2570.