If you want to purchase a new home, you might be considering a loan from a mortgage company. There are several things to consider before you make this decision. First, you’ll want to consider your options, including a direct endorsement lender, a fixed-rate mortgage, and a prepayment fee.
Fixed-rate mortgage
Having been one of the largest home construction companies in the United States in 2021, Lennar Mortgage is a well-known name in the mortgage industry. They offer several loan types: fixed-rate, adjustable-rate, and VA. In addition, they also provide financing on investment properties and second homes.
They are licensed in California, Colorado, Florida, New Jersey, Pennsylvania, and Arizona as a mortgage lender. The company’s average interest rates have been 0.10% below the national average since 2019.
However, there are some concerns about the quality of service that Lennar Mortgage provides. According to a lawsuit filed by Wanda Burling, a former company employee, they routinely hid negative information about loans. This information was buried in the “notes” section of their software. That way, government agencies couldn’t see it.
Burling says that the practice violated the federal False Claims Act. It was also a violation of HUD rules. She said that the loan originator added extra income to the loan application and omitted debts.
Direct endorsement lender
Lennar Mortgage, formerly known as Eagle Home Mortgage, has become the latest of many mortgage companies to be fined by the government. The company has been accused of misleading federal regulators and improperly incentivizing underwriters. In addition, it was alleged that Eagle Home submitted loans that did not meet FHA standards.
As for the actual product, Lennar offers fixed-rate mortgages, adjustable-rate mortgages, and jumbo loans. They also offer down payment assistance programs. However, not all of their loans are created equal. Some of their programs have higher interest rates than others.
According to the Department of Justice (DOJ), Eagle Home Mortgage violated several federal laws and HUD rules. For instance, the company hid negative information about loans from federal regulators. This violates the federal False Claims Act.
Despite its a+ rating with the Better Business Bureau, there are some concerns with the company. First, it doesn’t publish a required FICO score. Second, its customer service is not excellent.
Prepayment fee
A senior quality control manager at Eagle Home Mortgage, Wanda Burling, has filed a lawsuit against Lennar. The company allegedly misled the government and underqualified borrowers.
The company has agreed to settle the charges with a $13.2 million payout. Interestingly, the lawsuit was filed in the Pinellas County Circuit Court, where Lennar is active in new home communities.
In addition to being a mortgage lender, Lennar is also a home builder. The company specializes in multi-family and secondary homes. Several communities are located in 21 states.
According to the Department of Justice (DOJ), Eagle Home Mortgage intentionally misled the federal government by certifying that it was compliant with FHA lending requirements when it was not. Additionally, the company made loans to unqualified buyers.
Although Burling claims to have been fired from Eagle in retaliation for raising her concerns, her lawyer could not be reached for comment. She has filed a suit for compensatory damages and back pay with interest.
