Village Capital Fined For Ignoring 6 Percent Servicemember Mortgage Rate Cap
The mechanism is a form letter that reports a rate the note does not show, then a payoff formula that adds the larger of $500 or three times the overcharge.
The mechanism is a form letter that reports a rate the note does not show, then a payoff formula that adds the larger of $500 or three times the overcharge.
On October 19, 2026, the Justice Department announced a settlement saying Village Capital failed to apply the 6% servicemember rate cap on 41 mortgages and retaliated against borrowers who asked.
Why it matters: A pre-service mortgage payment, and a delinquency mark sent to the Department of Veterans Affairs, for a borrower who asked for a cap the statute already set.
Date to watch: October 29, 2026, ten calendar days after the October 19 announcement, the deposit deadline only if that day is the last signature under paragraph 9.
Sources:
- Settlement agreement, United States and Village Capital & Investment, LLC (2026-10-19)
https://www.justice.gov/crt/media/1466881/dl - Department of Justice press release, Village Capital SCRA settlement (2026-10-19)
https://www.justice.gov/opa/pr/va-home-loan-servicer-village-capital-pay-over-500000-violating-servicemembers-rights - 50 U.S.C. 3937, maximum rate of interest, United States Code 2023 edition (2023-01-01)
https://www.govinfo.gov/content/pkg/USCODE-2023-title50/html/USCODE-2023-title50-chap50-subchapII-sec3937.htm - 50 U.S.C. 3919, exercise of rights, United States Code 2023 edition (2023-01-01)
https://www.govinfo.gov/content/pkg/USCODE-2023-title50/html/USCODE-2023-title50-chap50-subchapI-sec3919.htm - 50 U.S.C. 4041, enforcement by the Attorney General, United States Code 2023 edition (2010-10-13)
https://www.govinfo.gov/content/pkg/USCODE-2023-title50/html/USCODE-2023-title50-chap50-subchapVIII-sec4041.htm - Public Law 108-189, Servicemembers Civil Relief Act (2003-12-19)
https://www.govinfo.gov/content/pkg/PLAW-108publ189/html/PLAW-108publ189.htm - Forbes Breaking News, Sherrod Brown questions Rohit Chopra on the SCRA (2023-12-13)
https://www.youtube.com/watch?v=XaGTUP5QICU - Federal News Network, Mac Warner on the Servicemembers Civil Relief Act (2025-06-10)
https://www.youtube.com/watch?v=gSTDc9bogcM
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