UWM sued by Ohio AG over ‘deliberate scheme’ to deceive borrowers
Top
U.S.
mortgage
lender
United
Wholesale
Mortgage
(UWM)
on
Wednesday
became
the
target
of
a
lawsuit
from
the
Ohio
Attorney
General,
Dave
Yost,
who
claims
UWM
conspired
with
mortgage
brokers
to
steer
loans
and
rip
off
consumers
in
Ohio.
The
case
seeks
to
hold
UWM
“accountable
for
orchestrating
and
executing
a
deliberate
scheme
to
deceive
thousands
of
Ohio
homebuyers
into
paying
millions
of
dollars
in
improper
fees
and
excessive
interest
rates
on
their
mortgages.
This
fraudulent
scheme
—
and
the
Illicit
enterprise
that
UWM
has
assembled
to
perpetrate
it
—
undermines
the
fundamental
structure
and
purpose
of
the
wholesale
mortgage
market
in
Ohio,”
the
lawsuit
states.
The
lawsuit,
filed
in
the
Court
of
Common
Pleas
in
Montgomery
County,
comes
one
year
after
a
report
from
Hunterbrook
Media
indicated
that
UWM
pressures
brokers
to
send
loans
its
way.
Borrowers
also
sued
the
company
last
year
over
the
same
matters
in
Michigan,
where
UWM
is
based.
A
spokesperson
for
UWM
did
not
immediately
reply
to
HousingWire‘s
request
for
comment.
“Buying
a
home
is
hard
enough
without
having
to
worry
about
a
lender
scheming
behind
your
back,”
Yost
said
in
a
statement.
“This
predatory
business
practice
has
no
place
in
Ohio.”
Yost
is
referring
to
the
claim
that
UWM
colludes
with
many
brokers
to
funnel
nearly
all
loans
back
to
itself
while
also
claiming
that
these
professionals
are
independent
and
search
for
the
best
deals
from
several
wholesale
lenders.
As
a
result,
UWM
allegedly
charges
borrowers
“above-market
rates
and
fees,”
and
does not
save
them
money,
as
it
claims.
“Thousands
of
unsuspecting
borrowers
did
not
obtain
any
such
‘independent’
advice
or
representation,”
the
lawsuit
states.
“Rather,
they
were
ensnared
in
UWM’s
scheme,
and
steered,
without
their
knowledge,
to
UWM’s
higher-priced
loans.”
Over
the
past
three
years,
according
to
legal
filing,
UWM
has
issued
nearly
$605
million
in
mortgages
in
Ohio
through
brokers
who
refer
99%
of
their
business
to
UWM.
In
2023,
50
Ohio
brokers
funneled
99%
or
more
of
their
mortgages
to
UWM,
with
a
total
volume
of
at
least
$215
million.
Meanwhile,
nearly
half
of
all
UWM
mortgages
in
Ohio
were
originated
by
brokers
who
referred
75%
or
more
of
their
business
to
the
firm
in
2023,
the
suit
claims.
Yost
charges
UWM
with
violations
of
Ohio’s
Consumer
Sales
Practices
Act,
Residential
Mortgage
Lending
Act
and
Corrupt
Practices
Act.
He
seeks
compensation
for
affected
consumers
and
civil
penalties
to
the
company.
