(The Center Square) – Conservative groups are watching a legal battle between the nation’s largest mortgage lender and the federal government, with one group calling for President-elect Donald Trump’s regulation-busting government efficiency group to get involved.
Last week, Rocket Mortgage filed a lawsuit against the U.S. Department of Housing and Urban Development over what Rocket Mortgage sees as the misuse of the Fair Housing Act. Rocket Mortgage says HUD wants it to leave appraisers alone while the DOJ wants it to make sure appraisers don’t engage in discriminatory practices. That puts the company “between the proverbial ‘rock and a hard place,'” Rocket attorneys wrote in a complaint filed last Wednesday.
Rick Manning, president of Americans for Limited Government, said Trump’s newly created Department of Government Efficiency should get involved. DOGE, which is co-led by Tesla CEO Elon Musk and tech entrepreneur Vivek Ramaswamy, was created to allow Trump’s next administration to “dismantle government bureaucracy, slash excess regulation, cut wasteful expenditures and restructure federal agencies,” Trump said.
Manning said DOGE should address alleged abuses of power at the U.S. Department of Justice, which sued Rocket Mortgage over the alleged conduct of an independent appraiser. The Justice Department claimed the Michigan lender discriminated against a Black homeowner who got an allegedly low appraisal when seeking to refinance her loan.
The Justice Department alleged that Rocket Mortgage LLC; Solidifi US Inc.; Maverick Appraisal Group Inc.; and appraiser Maksym Mykhailyna discriminated against a Black homeowner, Francesa Cheroutes, by undervaluing her home based on her race in an appraisal required as part of a home mortgage refinance application. The feds also alleged that Rocket Mortgage retaliated against the homeowner and interfered with her rights by cancelling her mortgage refinance application when she reported alleged discrimination.
Manning called the DOJ suit absurd.
“It is important to note that while a mortgage company may contract with the appraiser, the law requires that the appraisal be completely independent of the mortgage company,” he said. “In other words, it is illegal for the mortgage company to put their thumb on the scale in the determination of the value of a house under consideration for financing.”
The Taxpayers Protection Alliance said lenders aren’t allowed to intervene in appraisals by federal law.
“The problem lies in the DOJ’s decision to name Rocket in the lawsuit,” the group wrote. “The law does not allow lenders to intervene at any point in the valuation process. The Dodd-Frank Wall Street Reform and Consumer Protections Act created a firewall between lenders and the appraisal process following the 2008 housing and financial crisis.”
Consumer Action for a Strong Economy, another nonprofit, put it this way: “All Rocket is asking from the court is clarity on contradictory regulations that have left the mortgage lender sandwiched between either complying with federal law or doing what the DOJ demands of it.”
Trump’s DOGE has created buzz on Capitol Hill, but it has yet to get started on its work, which is due by July 4, 2026. Trump set lofty goals for the new group.
“It will become, potentially, ‘The Manhattan Project,’ of our time,” Trump’s announcement said. “Republican politicians have dreamed about the objectives of ‘DOGE’ for a very long time.”
The original Manhattan Project was a research and development project during the second World War that led to the creation of nuclear weapons.
