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CFPB fines Prospect Mortgage for illegal mortgage business referrals

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CFPB fines Prospect Mortgage for illegal mortgage business referrals

The Consumer Financial Protection Bureau has ordered Prospect Mortgage LLC to pay a $3.5 million civil penalty for allegedly paying kickbacks for mortgage business referrals and violating the Real Estate Settlement Procedures Act.

The agency also took action against two real estate brokers and a mortgage servicer that took illegal kickbacks from the company.

According to the CFPB, Prospect Mortgage was found to have signed agreements with companies in the name of advertising or promotional services, but actually paid for mortgage referrals. The company made payments to brokers to require consumers to get prequalified with them, even if they had satisfied the requirements with another lender.

The regulator also found that Prospect Mortgage maintained "improper arrangements" with more than 100 real estate brokers including RGC Services Inc., which does business as ReMax Gold Coast and Willamette Legacy LLC, also known as Keller Williams Mid-Willamette. Mortgage servicer Planet Home Lending LLC also took illegal kickbacks from Prospect Mortgage.

ReMax Gold Coast has been fined $50,000 in civil money penalties, and Keller Williams Mid-Willamette was ordered to pay $145,000 in disgorgement and $35,000 in penalties. Planet Home Lending will pay its affected consumers a total of $265,000 in redress.