Today the Massachusetts Attorney General’s Office announced a $4.65 million legal settlement with Newrez LLC – as successor by merger to Specialized Loan Servicing LLC (SLS).
According to the AG’s press release,
The settlement resolves allegations that SLS engaged in widespread unfair and deceptive servicing practices that put borrowers at unnecessary and unlawful risk of foreclosure in violation of state mortgage servicing and debt collection laws, as well as the COVID-19 foreclosure and eviction moratorium. SLS’s portfolio included nearly 24,000 properties in Massachusetts. Â
Specifically,
Following a comprehensive investigation into SLS’s business practices, the AGO identified numerous violations of Massachusetts’s consumer protection and foreclosure prevention laws. These practices included sending letters to consumers stating that they must cure their defaulted loans in only 33 days, when the law allows for a 90-day right to cure period; failing to take reasonable steps to avoid preventable foreclosures, including by failing to notify borrowers of their right to pursue a loan modification or lawfully process loan modification requests; and failing to provide required relief to homeowners who were financially impacted by the COVID pandemic, as required by law. The AGO asserts that by failing to comply with these essential requirements, SLS unfairly and unnecessarily put financially vulnerable homeowners at high risk of foreclosure.Â
To view a copy of the settlement agreement, click the document below.