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    Shapiro Administration Joins $15.5 Million Settlement to Protect Mortgage Borrowers Improperly Charged for Homeowners Insurance

    NewRez wrongly charged customers for "force-placed" insurance despite existing homeowners policies.

     

    Pennsylvania residents who believe they have been harmed should contact the Pennsylvania Department of Banking and Securities (DoBS) toll-free helpline at 1-800-PA-BANKS (1-800-722-2657).

    August 14, 2026

    Harrisburg, PA – Today, the Pennsylvania Department of Banking and Securities (DoBS) joined financial regulators from 47 states in a $15.5 million settlement with NewRez LLC (NMLS ID 3013), a Fort Washington-based mortgage servicer, after the company improperly charged borrowers for “force-placed” insurance even when they already had active homeowners insurance policies.

    Under the terms of the settlement, NewRez will pay $15.5 million nationwide, including more than $4.5 million already paid to impacted borrowers through the company’s self-identification and remediation efforts. The company will pay nearly $11 million in additional costs and penalties and must implement enhanced monitoring and other measures to strengthen its controls around force-played insurance.

    The settlement resolves an issue discovered in a multistate examination of NewRez that found the company had improperly imposed “force-placed” insurance on more than 4,200 borrowers nationwide with active homeowners’ insurance policies, causing consumer harm in the sum of $4.5 million. In Pennsylvania, impacted consumers have been reimbursed.

    “Under Governor Shapiro’s leadership, Pennsylvania remains a leader in consumer protections, and this settlement underscores the critical function of state regulators in overseeing financial licenses, demanding industry accountability, and safeguarding consumer rights for homeowners,” said DoBS Secretary Wendy Spicher. “I’m proud of our diligent and well-trained examiners who participated in this multi-state mortgage loan servicing examination as well as the other states who participated in the enforcement action.” 

    For its part, DoBS will receive $211,066.08 from the $9,900,000 fine, as well as $87,063.15 for being an examining state from the $1,088,757.84 in administrative costs NewRez incurred. 

    Force-placed insurance is often required when a homeowner’s policy is cancelled, delinquent or is insufficient in coverage and the borrower has failed to secure replacement coverage. If necessary, the lender, bank, or loan servicer may force the replacement coverage, which allows the lender to protect its financial interest in the property. This practice usually is significantly more costly than if a consumer secures their own insurance policy.  

    Pennsylvania residents who believe they have been harmed should contact the DoBS toll-free helpline at 1-800-PA-BANKS (1-800-722-2657). In addition, the DoBS Consumer Help Center provides courteous and timely responses to consumer inquiries and complaints related to financial entities which can be filed online through the DoBS Portal or by calling the toll-free helpline. Residents can also visit NMLS Consumer Access to verify that a company is licensed to do business in Pennsylvania, and they may also view past enforcement actions. 

    Since taking office, Governor Josh Shapiro and his Administration has taken action to strengthen consumer protections and help Pennsylvanians safeguard their finances by:

    • Requiring virtual currency transmitters to be licensed under Pennsylvania’s Money Transmitter Act, closing a regulatory gap that previously left consumers unprotected.
    • Establishing new criminal penalties for the use of artificial intelligence to create non-consensual forged digital likenesses, such as deepfakes and voice clones, used to commit fraud.
    • Launching an AI Literacy Toolkit to help Pennsylvanians safely and responsibly use artificial intelligence tools.
    • Creating an AI Enforcement Task Force with a reporting process for AI-powered bots that may be engaging in unlicensed professional practice.
    • Launching My Money, a centralized financial education resource that helps Pennsylvanians prevent fraud, improve financial literacy, and make informed financial decisions — building on the Administration’s broader consumer protection efforts, including the statewide consumer protection hotline 1-866-PACOMPLAINT (1-866-722-6675), pa.gov/consumer website, and consumer@pa.gov email address.
    • Returning more than $54 million to consumers through regulatory actions by DoBS and the Pennsylvania Insurance Department. 

    DoBS regulates financial services and works to ensure consumers and businesses are well-informed about the industry. Learn more about DoBS at pa.gov/dobs or follow DoBS on Facebook, X, or LinkedIn.