Consumer complaint received 2015-05-29
Company: VIRGINIA HOUSING DEVELOPMENT AUTHORITY
State: VA
Product: Mortgage
Sub-product: Conventional fixed mortgage
Issue: Application, originator, mortgage broker

Complaint:
In XX/XX/XXXX, we received correspondence from the Consumer Financial Protection Bureau regarding a legal settlement between CFPB, the United States Department of Justice and XXXX XXXX XXXX ( now XXXX XXXX ). In the consent order, it states that there are allegations regarding possible " discrimination impacting approximately XXXX XXXX and XXXX borrowers who potentially were charged higher interest rates and fees than XXXX borrowers because of their race or national origin rather than the borrowers ' credit worthiness. '' As part of the XXXX XXXX dollar settlement, impacted borrowers will be receiving a one-time disbursement of approximately {$540.00} once a signed Borrower Verification and Release of Claim form is submitted. 

We are very appreciative that this is being investigated, but wanted to know why a review for a possible interest rate reduction for these impacted borrowers is not part of the settlement. Is that something that can be considered? With low appraisal values preventing impacted borrowers ( like us ) from refinancing with their current mortgage company/servicer for a lower interest rate, we are paying a significant amount in interest each year with no way to lower the interest rate until the housing market rebounds. We have personally tried for years, however, due to our current loan to value, we are stuck at an interest rate of 7.25 % unless we come up with $ XXXX out of pocket, which really defeats the purpose of refinancing. 

Currently, our servicer is the Virginia Housing Development Authority and they have no plans to assist any of its borrowers with interest rate reductions, unless they are distressed. Unfortunately, no other company will refinance our mortgage due to our loan to value. The current HARP programs do not apply to loans owned by VHDA. 

In light of the recent allegations documented in this consent order, we are hoping the aforementioned can also be looked into, in hopes of helping some of these potentially impacted borrowers ( like us ) with a little relief. A {$540.00} one-time disbursement ( though we are appreciative ) compared to over $ XXXX we pay in interest a year on our current mortgage at 7.25 % in no way compensates. Although we feel the disbursement should be much more, we are more concerned about at least reducing the interest we will pay in the future through an interest rate reduction. 

We do n't want to lose this disbursement and have until XX/XX/XXXX to sign the Release of Claim which would prevent us from pursuing any further legal action. VHDA is currently looking into options, now that we have provided them with the documentation regarding the settlement, but we are not sure they will assist. Lastly, we reached out to the Department of Justice who referred us to the CFPB for any further inquiries, which is why we are completing this complaint per their instruction. 

Thanks in advance for your review and consideration to help provide relief.

Company response to consumer: Closed with explanation