The Massachusetts Division of Banks announced yesterday that it issued four cease and desist orders against licensed mortgage lenders and brokers. Each case involved was in violation of the Commonwealth of Massachusetts reverse mortgage statute which requires lenders to receive approval before it originates reverse mortgages. More information on Massachusetts reverse mortgage statute here.
According to the press release, actions were taken against First Call Mortgage Company, Inc., Sun West Mortgage Company, Inc., and Gold Reverse, Inc. who were making reverse mortgage loans to Massachusetts seniors without an approved plan from the state. All three companies have been prohibited from accepting any new mortgage applications and have been ordered to place all pending applications with a qualified lender at no cost to the consumer.
The Division also issued a cease and desist order against American Advisors Group, for engaging in unfair and deceptive advertising practices involving reverse mortgage products. American Advisors Group engaged in a direct mail campaign in which reverse mortgage loans were marketed as government benefits. You can see a copy of the mailing here.
The Division’s order forbids American Advisors Group from initiating any new mortgage loan transactions and requires pending applications to be placed with a qualified lender or broker at no cost to the consumer. In addition, the company has been ordered to cease its advertising in Massachusetts and provide the Division with a complete list of all individuals that its direct mail advertisements were sent to.
State Division of Banks Takes Action Against Illegal Reverse Mortgage Programs Targeting Seniors
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