NewRez Faces $4.2m in Servicing Penalties

March, 2026

Over 125 consumer complaints have prompted Washington state regulators to propose hefty financial penalties against Newrez. The complaints stem from numerous mortgage servicing violations.

The fines may total in excess of $4.2 million for repeated servicing violations between 2021 and 2026. The violations include providing inaccurate information about loans, escrow and insurance obligations to borrowers and credit bureaus, and many other violations.

"Washington homeowners rely on licensed mortgage servicers to correctly service their loans, and we will hold companies accountable when they put consumers at risk of losing their homes or when they financially harm consumers," state DFI director Charlie Clark said in a press release.

The penalty would be one of the largest ever issued by Washington regulators against a financial services company.

"DFI closely monitors consumer complaints and takes action when serious violations are discovered," Clark added. In addition to the fine, the statement of charges ordered Newrez to fix the issues behind the complaints, which first appeared in 2023, according to the department.  

The list of accusations include:

• On at least 16 occasions, payments were incorrectly applied and inaccurate statements were sent to borrowers.

• 62 Washington consumers were provided improper servicing maintenance for escrow accounts.

• Several loans were incorrectly on-boarded, resulting in poor credit reporting and inaccurate escrow accounts along with private mortgage insurance errors.

• 29 homeowners were subject to unfair and deceptive practices including failure to mediate in good faith during foreclosure or respond to consumer questions and concerns promptly and accurately.

Newrez issues a statement stating it was disappointed by the “surprise nature” of the announcement and that charges were delivered without warning or discussion.

"While we are still reviewing the specifics of each claim, we fundamentally disagree with the state's charges and the way our practices have been characterized and intend to vigorously contest the action and its allegations," the company wrote in a statement.

Newrez is allowed to request a formal hearing on the charges.

"Newrez takes its obligations to our customers and investors very seriously and is committed to operating in compliance with all applicable state and federal laws," it added.

This is the latest violate of the Fort Washington, Pennsylvania=based mortgage company over the past three years.

However, many of the previous lawsuits were committed by Specialized Loan Servicing, a unit of Compushare purchased by Rithm Capital and Newrez in 2024.

Newrez paid $4.7 million in penalties to resolve penalties in Massachusetts for alleged violations committed by Specialized Loan Servicing.

Post-closing audits. pre-funding audits. Mortgage quality control. Mortgage staffing.