Consumer complaint received 2025-06-30 00:00:00
Product: Mortgage — VA mortgage
Issue: Trouble during payment process — Lien release
Company: Village Capital & Investment LLC
State: GA

Complaint narrative:
I am submitting this complaint against Village Capital & Investment, LLC regarding their unlawful continuation of mortgage servicing activity on a VA loan that was fully paid off through the U.S. Department of Veterans Affairs VA Servicing Purchase ( VASP ) program. 

According to a written statement from XXXX XXXX dated XX/XX/XXXX, the VA paid off my loan in full, and they received funds on XX/XX/XXXX. Despite this, Village Capital continues to act as the loan servicer, collecting payments, charging late fees, and reporting to credit bureaus under their own name. They claim to be a sub-servicer on behalf of the VA however, this is a misrepresentation and a direct violation of VA servicing guidelines. 

Specifically, VA Servicer Handbook M26-4, Chapter 9.03 states : Upon receipt of payment from VA under the VASP program , the servicer shall immediately cease all collection activity and submit all necessary documentation to complete transfer of servicing.

This language is clear : the original servicer loses all servicing authority once the VA acquires the loan. There is no provision authorizing a prior lender to continue acting as a sub-servicer unless formally contracted by the VA, and the borrower must be notified of such transfer. I have received no such notice, nor does Village Capital appear in any official VA correspondence or systems as my authorized loan servicer. 

Additionally, a recorded subordination document was filed in XXXX XXXX, Georgia, showing that Village Capital voluntarily relinquished their primary lien position to the VA. This evidences that their interest in the mortgage was extinguished, and they can not lawfully claim ownership, enforcement rights, or collection authority.

Nonetheless, Village Capital continues to : Report an active tradeline on my credit profile Demand payments under their name Apply late fees and penalties Refuse to file a Satisfaction of Mortgage These actions are deceptive, predatory, and cause significant harm to my creditworthiness. They violate both FCRA ( 15 U.S.C. 1681s2 ( a ) ) and FDCPA ( 15 U.S.C. 1692e and 1692c ( c ) ), and contradict VA guidelines for loan servicing post-VASP payoff. 

I am requesting that the CFPB : Investigate Village Capitals unlawful claim to sub-servicing authority Order Village Capital to file a Satisfaction of Mortgage immediately Mandate deletion of the tradeline from all consumer reporting agencies Demand reimbursement of all payments and late fees collected after XX/XX/XXXX Prevent Village Capital from dismissing this as a duplicate complaint, as new and material evidence is attached, including : A copy of the Village Capital letter acknowledging VA payoff The recorded lien subordination agreement The VA Handbook ( M26-4, Ch. 5 & 9 ) outlining servicing prohibitions This conduct is willfully deceptive, violates federal guidelines, and seeks to retain control over a loan they no longer legally own. Immediate CFPB intervention is required to protect my rights as a veteran borrower.

Company response to consumer: Closed with explanation