If you are a disabled veteran whose home is exempt from property taxes and your mortgage is serviced by Lakeview or LoanCare, this suit is about being charged for those taxes anyway — but it is a brand-new complaint, so there is nothing to file or claim yet.
Allegations Only · No Settlement Yet
This article describes a class action complaint. The statements below are unproven allegations. Lakeview Loan Servicing, LLC and LoanCare, LLC have not been found liable, there is no certified class, and nothing to claim at this time. This page is informational and is not legal advice.
What Is This About?
An 82-year-old disabled Vietnam veteran and his wife have filed a proposed class action alleging their mortgage servicers charged them — and thousands of other exempt veterans — for real estate taxes they do not owe. According to the complaint, filed June 18, 2026 in the U.S. District Court for the Eastern District of Virginia (Richmond Division), the named plaintiff is a veteran whom the Department of Veterans Affairs rated 100% service-connected, permanently and totally disabled after his exposure to Agent Orange. Under Virginia law, that status exempts his principal residence from state and local real estate taxes.The defendants are Lakeview Loan Servicing, LLC, described in the complaint as one of the nation's largest mortgage servicers, and LoanCare, LLC, its subservicer, which the complaint says handles the day-to-day servicing of the loan as Lakeview's agent. The lawsuit alleges that despite the exemption, the servicers added property taxes to the borrowers' escrow account, inflated their monthly payment by hundreds of dollars, and then assessed late fees and reported the account as delinquent when the borrowers paid only what they actually owed. The allegations have not been proven, and neither company has been found liable.
What the Complaint Alleges
The complaint says two prior servicers had handled the loan without ever charging the couple for the exempt property taxes. Then, after Lakeview and LoanCare took over servicing in late 2022, the plaintiffs allege the escrow charges changed dramatically. In March 2025, the servicers allegedly told the couple their new payment would be about $758 higher than before — around $3,352 — and debited it from their bank account, with a further inflated payment for April. According to the complaint, the servicers said they had made a property-tax disbursement to the county, yet also told the couple they had not received any documentation from the county requesting payment of those taxes.When the plaintiffs paid only what they say they actually owed, the complaint alleges the servicers treated the loan as in default and added a late fee of $103.35, an inspection fee of $25, and a second late fee of $126.90, then reported the account as delinquent to the credit bureaus. Facing the threat of foreclosure and damage to their credit, the plaintiffs allege they paid roughly $8,443 in June 2025 to cover several months at once. The complaint says the inspection fee still appears as past due on their statements as recently as July 2026.
The lawsuit alleges the servicers refused to fix the problem even after being shown proof. The plaintiffs say they submitted disputes to Equifax, Experian, and Trans Union with documentation of the veteran's disability rating and the improper escrow amounts, and later sent a Qualified Written Request under RESPA in March 2026. According to the complaint, the servicers acknowledged in writing that the taxes had been paid in error and said the derogatory reporting would be corrected — but, the plaintiffs allege, did not correct the credit reporting, refund the improper payments, or remove the inspection fee within the time the law requires. These remain allegations that the defendants have not answered in court.
The Legal Claims
The complaint brings seven counts. Three are class claims against both servicers under Virginia common law: breach of fiduciary duty over the handling of the escrow accounts, unjust enrichment from the fees and interest allegedly retained, and negligence in servicing the loans. Two are class claims against LoanCare under RESPA — one for allegedly failing to correct account errors within the time a Qualified Written Request requires, and one for allegedly continuing to report the overdue payments to credit bureaus during the 60-day window that follows such a request. The final two are individual claims against LoanCare under the Fair Credit Reporting Act, alleging it failed to properly investigate the plaintiffs' credit disputes and did not review the documentation the bureaus forwarded.The suit is brought under the Class Action Fairness Act, and the complaint alleges the amount in controversy exceeds $5 million across the proposed nationwide class. The plaintiffs allege the servicers use uniform policies for assessing and collecting property taxes, so the same conduct affected other exempt veterans. Whether any of that is accurate has not been decided; the defendants have not yet responded, and no class has been certified.
What the Lawsuit Seeks
On behalf of the proposed classes and themselves, the plaintiffs ask the court to certify the case as a class action and to award actual, statutory, and punitive damages, along with attorneys' fees and costs and pre- and post-judgment interest. In plain terms, the suit seeks to make the servicers refund the improper escrow charges, late fees, and inspection fees, correct the credit reporting, and stop charging exempt disabled veterans for taxes they do not owe. The complaint also demands a jury trial. None of this is a court ruling — it is what the plaintiffs are requesting.What Happens Next?
Because this is a newly filed complaint, the next steps are procedural: the defendants will have the opportunity to respond, likely with a motion to dismiss, and the court will eventually decide whether the case can proceed and whether a class should be certified. Only if the case survives those stages and later settles or wins would any refund or correction to class members follow — and any such process would be defined by the court, not available today.If your mortgage is serviced by Lakeview or LoanCare and you are a disabled veteran exempt from property taxes, there is nothing to file right now. The practical step is to keep your own escrow statements, exemption paperwork, and dispute records; if a class is ever certified or a settlement is reached, those documents could matter. We will update this page as the case develops.
Read the Complaint (PDF)
Frequently Asked Questions
What does the Lakeview and LoanCare lawsuit allege?
The proposed class action alleges that mortgage servicer Lakeview Loan Servicing and its subservicer LoanCare charged disabled veterans for real estate taxes that state law exempts them from paying. According to the complaint, the servicers added those exempt property taxes to borrowers' escrow accounts, inflated the monthly mortgage payment by hundreds of dollars, and then assessed late fees, an inspection fee, and negative credit reporting when the borrowers refused to pay the amounts they did not owe. These are unproven allegations; the defendants have not been found liable.
Is there a settlement or money to claim right now?
No. This is a newly filed complaint. No class has been certified, there is no settlement, and there is no claim form or deadline. The lawsuit asks the court to order the servicers to refund the improper charges and correct the credit reporting, but nothing can be claimed at this stage.
Who could be covered if a class is certified?
The proposed classes would generally cover borrowers whose home is in a state that exempts disabled veterans from real estate taxes, who qualify for that exemption, and who were nonetheless charged for property taxes in their escrow accounts on a mortgage serviced by the defendants during the class period. The complaint says at least 22 states offer full property tax exemptions for disabled veterans. The court has not certified any class, so the exact definition and dates are not final.
What are RESPA and FCRA, and how do they fit in?
RESPA (the Real Estate Settlement Procedures Act) governs how mortgage servicers must respond to a borrower's written notice of an error, known as a Qualified Written Request. The complaint alleges LoanCare failed to correct the errors in time and kept reporting the account as delinquent during the protected 60-day window. FCRA (the Fair Credit Reporting Act) requires a company that furnishes information to credit bureaus to investigate disputes; the complaint alleges LoanCare did not meaningfully investigate and kept reporting inaccurate delinquencies. All of these are allegations that have not been proven in court.
What should I do if I think I was charged for taxes I'm exempt from?
There is nothing to file in this lawsuit right now. As a general matter, borrowers can review their escrow statements, keep records of their exemption and payments, and dispute errors in writing with their servicer and the credit bureaus. This page is informational and is not legal advice. We will update it as the case develops.
Sources
- Class Action Complaint — Arrington v. Lakeview Loan Servicing, LLC (E.D. Va. No. 3:26-cv-00569-RCY)
- Va. Code § 58.1-3219.5 — Disabled veteran real estate tax exemption
- CFPB — Regulation X (RESPA) § 1024.35, error resolution procedures
- CFPB — Consumer Complaint Database
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