A class-action lawsuit recently filed in California federal court against real estate brokerage franchisor Realogy and embattled mortgage lender PHH may shed some light on the companies’ recent decision to amend their joint-venture agreement.
- A lawsuit filed Nov. 25 in California federal court targets the joint venture between Realogy and PHH, alleging that they violated the Real Estate Settlement Procedures Act (RESPA) by operating a “sham” affiliated business arrangement.
- The complaint alleges that PHH Home Loans failed to disclose the existence of affiliate partners to consumers and was engineered to funnel kickbacks and referral fees.
- PHH is already under scrutiny for its mortgage reinsurance arrangements.
- The defendants have not yet responded to the complaint.