Low VA Rates, LLC
On October 26, 2020, the Consumer Financial Protection Bureau (Bureau) issued a consent order against Low VA Rates, LLC (Low VA Rates), a Utah-based mortgage lender and broker incorporated in Colorado and licensed in 48 states and the District of Columbia. Low VA Rates offers and provides mortgage loans guaranteed by the United States Department of Veterans Affairs (VA). Low VA Rates’ principal means of advertising VA-guaranteed loans is through direct-mail campaigns sent primarily to United States military servicemembers, veterans, and their families. The Bureau found that Low VA Rates sent consumers mailers for VA-guaranteed mortgages that contained false, misleading, or inaccurate statements, in violation of the Consumer Financial Protection Act’s (CFPA) prohibition against deceptive acts and practices, the Mortgage Acts and Practices – Advertising Rule (MAP Rule), and Regulation Z. Specifically, Low VA Rates sent consumers numerous advertisements for VA-guaranteed mortgages that, among other things, promoted mortgage products that were not actually available; 2) failed to properly disclose rates and repayment terms; 3) used misleading descriptions of rates; and 4) used misleading representations regarding the savings or financial benefits available to consumers. The consent order requires Low VA Rates to pay a $1,800,000 civil money penalty and imposes requirements to prevent future violations.
This action stems from a Bureau sweep of investigations of multiple mortgage companies that use deceptive mailers to advertise VA-guaranteed mortgages.
On July 24, 2020, the Bureau announced consent orders against Sovereign Lending Group, Inc., and Prime Choice Funding, Inc.; on August 21, 2020, the Bureau announced a consent order against Go Direct Lenders, Inc.; on August 26, 2020, the Bureau announced a consent order against PHLoans.com, Inc.; on September 1, 2020, the Bureau announced consent orders against Hypotec, Inc. and Service 1st Mortgage, Inc.; on September 2, 2020, the Bureau announced a consent order against Accelerate Mortgage, LLC; and on September 14, 2020, the Bureau announced a consent order against ClearPath Lending, Inc. for similar violations. The Bureau commenced this sweep in response to concerns about potentially unlawful advertising in the market that the VA identified.