Citizens Bank claims The Mortgage Link failed to honor a repurchase agreement after a Freddie Mac audit
Citizens Bank is taking The Mortgage Link to court over a mortgage loan gone wrong, raising questions about risk and responsibility in today’s secondary market.
On September 8, 2025, Citizens Bank, N.A. filed a complaint in the United States District Court for the District of Rhode Island, accusing The Mortgage Link, Inc., a Maryland-based lender, of failing to honor a key agreement. The story starts with a familiar industry scenario: a mortgage loan, a secondary market sale, and a contract that’s supposed to keep everyone honest.
Here’s what happened, according to the complaint. Citizens Bank buys closed residential mortgage loans from lenders like The Mortgage Link, then resells those loans to big players such as Freddie Mac and Fannie Mae. The bank often keeps the servicing rights, so it’s got a lot riding on making sure those loans meet every guideline in the book.
The loan at the center of this dispute was originated by The Mortgage Link for a borrower named Kekoye Sagnia, secured by a property in Montgomery Village, Maryland. The two companies had a deal in place—a Correspondent Loan Purchase Agreement, signed back in May 2019—requiring The Mortgage Link to guarantee that its loans would meet all of Freddie Mac’s requirements and that nothing about the loan would trigger a repurchase demand.
After Citizens Bank bought the Sagnia loan, it sold it on to Freddie Mac. Fast forward to early 2025, and Freddie Mac’s audit team flagged the loan. The issue? The Mortgage Link hadn’t provided proof that some of the borrower’s other debts had been paid off. Citizens Bank reached out to The Mortgage Link in February, asking for answers. The complaint says The Mortgage Link didn’t respond, despite follow-up requests.
By March, Freddie Mac had seen enough and demanded that Citizens Bank take the loan back. Citizens complied, repurchasing the Sagnia loan. Then, in late March, The Mortgage Link told Citizens that the loan’s problems were “incurable” and seemed to expect a repurchase demand. That demand came in July, but The Mortgage Link refused to buy the loan back, according to the complaint.
The numbers here are not small. As of August 1, 2025, the repurchase price for the Sagnia loan was $448,839.35, not counting legal costs and attorneys’ fees. Citizens Bank is now asking the court to award damages of at least that amount, plus interest, legal fees, and any other losses tied to The Mortgage Link’s alleged breach.
What does this mean for mortgage professionals? This case is a sharp reminder that the details in those purchase agreements matter—a lot. When loans get kicked back from the secondary market, the fallout can be expensive and messy. It’s a scenario that could play out for any lender or correspondent in the business.
It’s important to note that these are allegations from Citizens Bank’s complaint. The court hasn’t made any decisions yet, and The Mortgage Link’s side of the story will come out as the case moves forward. Still, for anyone working in the mortgage industry, this dispute is a real-world example of the risks and responsibilities that come with selling loans into the secondary market.
