PHH Mortgage class action accuses company of predatory reverse mortgage practices

PHH Mortgage class action overview:

• Who: Plaintiff Lisa Mattia filed a class action lawsuit against PHH Mortgage Corp. and Onity Group Inc.
• Why: Mattia claims PHH Mortgage and Onity Group engaged in fraudulent and predatory practices with reverse mortgage origination and servicing.
• Where: The PHH Mortgage class action lawsuit was filed in New York federal court.

A new PHH Mortgage class action lawsuit accuses PHH Mortgage and Onity Group of engaging in fraudulent and predatory mortgage practices in connection with their origination and servicing of reverse mortgages.

Plaintiff Lisa Mattia filed the class action complaint against PHH Mortgage Corp. and Onity Group Inc. on March 17 in New York federal court, alleging violations of state and federal consumer laws and regulations.

According to the lawsuit, PHH Mortgage, one of the largest servicers of residential loans in the United States, has a history of employing aggressive, deceptive and illegal tactics to maximize profits at the expense of vulnerable borrowers, including the elderly and disabled.

The lawsuit claims PHH Mortgage used reverse mortgages, a financial product that allows homeowners to borrow money using their home as security for the loan, to prey on the fears and insecurities of the elderly and infirm.

Mattia claims PHH Mortgage locked these borrowers, and later their heirs, into loans with unexplained, undisclosed and unsubstantiated fees, interest and penalties.

Class action: PHH Mortgage illegally forced entry into homes

Mattia, the niece and court-appointed executor of Lillian O’Keefe, claims PHH Mortgage preyed on O’Keefe during a period of declining health. She claims O’Keefe, a financially stable homeowner, was induced by PHH Mortgage’s deceptive marketing to take out a reverse mortgage on her home while she was suffering from health issues.

After O’Keefe’s death in June 2024, Matti claims she promptly notified PHH Mortgage that the loan would be repaid in full upon the sale of O’Keefe’s house.

However, Mattia alleges PHH Mortgage engaged in a course of unconscionable, misleading and deceptive conduct that made the loss of her loved one exponentially more difficult and costly.

Among other things, Mattia claims PHH Mortgage never provided her with the mortgage documents or payment history she requested, falsely told her they had initiated foreclosure proceedings, and hired an unsupervised, unvetted third-party vendor who illegally entered O’Keefe’s home and destroyed personal items.

The lawsuit seeks to represent all individuals who obtained reverse mortgages from PHH Mortgage or whose reverse mortgages were serviced by the company and who were harmed by its conduct.

Mattia is suing for violations of the Fair Debt Collection Practices Act, the Real Estate Settlement Procedures Act, New York General Business Law, New York Real Property Law, trespass, conversion, intentional infliction of emotional distress and breach of contract. 

She is seeking certification of the PHH Mortgage class action, damages, fees, costs and a jury trial.

In other news, PHH Mortgage Corp. recently agreed to a $1.5 million settlement to resolve claims that it violated federal and state debt collection laws by sending misleading default notices.

What do you think of the allegations made in this PHH Mortgage class action lawsuit? Let us know in the comments.

The plaintiff is represented by Joseph M. Pastore III and Leanne M. Shofi of Pastore LLC and Brandon Lacoff and Michele S. Carino of Greenwich Legal Associates LLC.

The PHH Mortgage class action lawsuit is Mattia v. PHH Mortgage Corporation, et al., Case No. 1:26-cv-01584, in the U.S. District Court for the Eastern District of New York.

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