Ohio Attorney General Dave Yost has filed a lawsuit against United Wholesale Mortgage (NYSE: UWMC) that accuses the company of “conspiring with brokers to rip off Ohio consumers.”
In his lawsuit, Yost – who launched his campaign for Ohio governor in January – alleged that United Wholesale Mortgage falsely claims mortgage brokers are independent from the company, but insisted the company colluded with many brokers to “funnel nearly all loans back to itself,” resulting in borrowers being charged above-market rates and fees instead of saving them money. The company issued roughly $605 million in mortgages to Ohioans from 2021 through 2023, according to the lawsuit, which alleged independent brokers “directed 99% of their business back to United Wholesale Mortgage.”
“Thousands of unsuspecting borrowers did not obtain any such ‘independent’ advice or representation,” the lawsuit said. “Rather, they were ensnared in UWM’s scheme, and steered, without their knowledge, to UWM’s higher-priced loans.”
The lawsuit, which was filed in Montgomery County Common Pleas Court, accused the company of violating Ohio’s Consumer Sales Practices Act, Residential Mortgage Lending Act and Corrupt Practices Act, among others. It seeks compensation for affected consumers, civil penalties and a court order requiring the company to comply with Ohio law.
The company responded to Yost’s announcement with a statement that said, “We had no prior knowledge or warning of this lawsuit filed by the Ohio Attorney General, which is in and of itself suspicious. It essentially repeats the frivolous allegations contained in a virtually identical lawsuit filed last year by a law firm that has a business arrangement with a hedge fund. In response to that lawsuit, we are seeking sanctions against the law firms that filed it, and have moved to dismiss the claims. We will take similar actions against this PR stunt by the Ohio Attorney General, and will continue to defend these allegations to the fullest extent permitted by law. UWM stands with the thousands of independent mortgage brokers who serve the unique needs of borrowers across the country.”
