LoanDepot is facing a lawsuit from borrowers in Maryland, Virginia, and Florida over unfair loan practices alleged to have taken place between 2019 and 2021. Plaintiffs claim that loanDepot required loan officers who could not secure higher-cost loans to transfer borrowers to internal loan consultants, creating a fictional process where the original loan officer continued to handle the loan. As a result, borrowers paid inflated rates and fees. The lawsuit outlines issues of falsified documentation and pressures placed on loan officers to comply with these practices to avoid losing commission.
According to the lawsuit, loanDepot required loan officers unable to obtain higher-cost loans to transfer borrowers to internal loan consultants, regardless of actual necessity.
The lawsuit alleges that loanDepot's internal transfer process was a fiction, with the original loan officer maintaining their responsibilities while the ILC's signature was electronically robosigned.
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