HUD Reaches Tentative Settlement with Reverse Mortgage Lender Over Violations

image The US Department of Housing and Urban Development announced its Mortgagee Review Board (MRB) is imposing civil money penalties against two FHA approved lenders in  Wisconsin and Connecticut for a variety of violations of FHA lending and marketing standards.

In addition, the MRB reached tentative settlements with four other lenders and issued two Letters of Reprimand to lenders that HUD alleged violated FHA requirements.

One of the lenders it reached a tentative settlement with is Cerritos, California based Sun West Mortgage Company.  HUD alleges that the reverse mortgage lender originated ten HECM loans in Massachusetts before receiving the necessary license and approval to originate HECM loans in that state and failed to notify HUD that Massachusetts had issued a Cease and Desist order prohibiting it from the unlicensed origination of loans in that jurisdiction. 

Sun West agreed to pay a Civil Money Penalty of $10,000 and accept a Letter of Reprimand to resolve the matter.  

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