Pulte Homes and Pulte Mortgage Face Consumer Fraud Charges from the Arizona Attorney General

Pulte Home Corp., the nation’s largest homebuilder, is facing consumer fraud charges brought by Arizona Attorney General, Terry Goddard.  Goddard claims, amongst other things, that Pulte defrauds consumers by informing them that they have “pre-qualified” for financing at a certain rate but later offers them a much higher rate.  One customer was promised a 7% interest rate during the pre-qualification process but was later offered a 13.875% interest rate.  Subsequently the customer was forced to forfeit her earnest deposit because she “could not afford the loan which was offered.”

Customers are promised a full refund of all but $500 of their earnest money if they supply Pulte Home with a loan disapproval notice before the loan application deadline expires.  However, in numerous instances, Pulte Mortgage did not give loan disapproval notices to customers before the deadline had passed and denied a refund to those customers.

Goddard also claims that Pulte targets Spanish-speaking customers through websites and advertisements but does not provide translators, does not provide contracts in Spanish, and does not provide the same disclosures, including the “risks” of its loans, that are available to English speakers.

Pulte sales representatives sell potential customers on the promise of “purchase price reductions, money towards upgrades or closing costs and interest rate buy down.”  These promises paired with comparable loan terms led many consumers to choose Pulte Mortgage over other lenders, only to discover later that the loan products were substantially different from and more expensive than those initially offered by Pulte Homes sales representatives during the oral “pre-qualification” process.

Goddard is seeking restitution, an injunction and civil penalties for consumer fraud against Pulte Home & Pulte Mortgage.

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