The Division of Banks this week fined a Massachusetts-based mortgage lender and ordered it to immediately correct its procedures and fix a substantial number of data errors found in its required reports to regulators under the federal Home Mortgage Disclosure Act (HDMA).
Mortgage Master Inc. is required to pay a $50,000 fine to the Commonwealth for its errors, the Division said in a statement.
"If a company files inaccurate information, it does not provide a complete picture for regulators to assess whether or not the company is meeting fair lending requirements," Commissioner of Banks David Cotney said in a statement. "These administrative actions demonstrate the seriousness of Mortgage Master repeated data oversights, which ultimately impact the integrity and usefulness of residential mortgage information for the public."
Mortgage Master has been licensed by the Division since 1992 and is one of the state’s largest mortgage lenders, with more than 12,000 annual residential mortgage applications.
In 2010, Mortgage Master entered into a settlement agreement with the Division to address consumer protection violations, including unlicensed loan originator activity and doing business from unlicensed locations. This most recent action replaces the 2010 agreement and is the result of a follow-up examination conducted by the Division. As part of the previous settlement, the company had agreed to establish, implement and enhance its HMDA oversight and data verification procedures because its errors exceeded acceptable limits. This latest review of the company’s HMDA data continued to show high rates of errors, despite minor improvements made since 2010.
The Consumer Financial Protection Bureau (CFPB) recently took similar action against Mortgage Master. The CFPB conducted a simultaneous examination of the company and found significant errors with its HMDA data. The Division and the CFPB are both requiring Mortgage Master to obtain an independent review of its HMDA data program and develop a comprehensive plan to ensure accuracy and prevent future errors. Mortgage Master is also being required by the Division and the CFPB to correct and resubmit its HMDA data.
