Radio and television commercials promised Hispanic homeowners that the company could cut their mortgage payments in half, and even offered $500 gift cards to entice Hispanic homeowners to sign up for loan modification assistance.
But it was too good to be true, and the U.S. Department of Housing and Urban Development (HUD) is charging a Florida company and its owners with housing discrimination, alleging they intentionally targeted Hispanic homeowners in a predatory mortgage modification scheme. Rather than decrease their customers’ mortgage liability, however, they increased their risk of foreclosure.
HUD claims that Advocate Law Groups of Floridan (ALG), P.A., Jon B. Lindeman, Jr., and Ephigenia K. Lindeman violated the Fair Housing Act by intentionally targeting Hispanic families through a deceptive advertising campaign that aired on Spanish-language radio and television stations throughout Florida.
“As we peeled back the facts of this case, we were stunned by a business model built to target Hispanic homeowners,” says Anna María Farías, HUD’s Assistant Secretary for Fair Housing and Equal Opportunity. “HUD will use the full weight of the law to protect families from those who would prey upon them because of where they come from or what language they speak.”
HUD’s charge, filed on behalf of three Orlando-area Hispanic families, alleges that Spanish-speaking ALG employees made false promises at initial client meetings as a way to talk families into paying significant upfront fees and sign contracts. Those contracts were predominantly, if not entirely, written in English.
After being retained, ALG instructed homeowners to stop making mortgage payments and stop communicating with their mortgage lenders or servicers, which placed their homes at imminent risk of foreclosure.
In addition, HUD’s alleges that ALG neglected their clients’ cases and ignored bank requests for information.
When homeowners complained about their mistreatment, ALG threatened them with increased mortgage payments, fines or foreclosure if they sought to terminate their relationship. ALG allegedly charged clients thousands of dollars in up-front and recurring monthly fees, yet ultimately failed to obtain favorable mortgage modifications for them.
“Intentionally targeting families with predatory mortgage services because of their national origin is a clear violation of the Fair Housing Act,” says Paul Compton, HUD’s general counsel. “This charge sends a clear message that HUD will protect the housing rights of all persons to the fullest extent of the law.”
This year marks the 50th anniversary of the passage of the Fair Housing Act, and the 30th anniversary of amendments to the Act prohibiting discrimination against persons with disabilities and families with children. The Fair Housing Act prohibits discrimination in housing because of race, color, religion, national origin, sex, disability and familial status.
People who believe they have experienced discrimination may file a complaint by contacting HUD’s Office of Fair Housing and Equal Opportunity at (800) 669-9777 (voice) or (800) 927-9275 (TTY). Housing discrimination complaints may also be filed by going to www.hud.gov/fairhousing.
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