Federal investigators have issued subpoenas to various mortgage lenders in an investigation into whether VA lenders are overcharging customers, according to a new report. The subpoenas call for the lenders to turn over information on delinquencies and payments.
The lenders allegedly requested hundreds of files on VA home loans made between 2013 and 2017 from at least lenders, according to a Politico report. The requested files also included questions about quality control and loan audits.
Some VA lenders sold short-term, adjustable-rate mortgages to military homeowners during an increase in interest rates. These lenders were able to put existing VA borrowers into new loans without an appraisal or underwriting through a VA program called the Interest Rate Reduction Refinance Loan (IRRRL).
The Department of Veterans Affairs Office of Inspector General and the US attorney for the Eastern District of New York are leading the investigation.
Spokesperson Michael Nacincik from the Department of Veterans Affairs OIG and John Marzulli from the US Attorney’s Office in Brooklyn refused to comment, saying they could neither confirm nor deny the existence of any investigation, according to Politico.