US home loan company settles
Publish date: 02 February 2006
Issue Number: 1513
Diary: Legalbrief Today
Category: General
In what has been described as the second-largest consumer protection settlement in US history, Ameriquest Mortgage, the nation\'s largest lender to home-loan borrowers with poor credit, has agreed to pay $325m to resolve allegations that the company defrauded and misled consumers.
The Washington Post reports the settlement is slightly less than the $484m predatory lending agreement reached in 2002 with Household Finance Corp. State law enforcement officials in California said Ameriquest grew and profited by giving loan officers financial incentives to sign consumers to loans that often hurt them. They said they found some cases in which people with good credit who qualified for lower interest rates got higher rates, many cases in which people were promised lower rates but charged higher rates, and numerous instances in which borrowers were encouraged to falsely state they made more money than they did so that they could borrow more than they could afford. Full report in The Washington Post
