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| Two Missouri mortgage brokerages have been sued by the state over allegations of misleading advertising. One of the firms is accused of sending letters that appeared to be from the borrowers’ existing lenders, while the other is accused of trying to deceive borrowers into believing that it was related to the U.S. Department of Housing and Urban Development.Missouri Attorney General Chris Koster said today that he filed a lawsuit against Goldstar Home Mortgage.
Goldstar allegedly mailed out direct mail pieces that included the names of the borrowers at the top of the letters. The letter format made it appear that the mailings were sent directly from the borrowers’ own lenders. The company is also accused of offering inappropriate loan programs. One case was cited where the borrower’s new balance would have been higher than the home’s value. Oxford Lending Group was also sued by the attorney general. Mailings sent by Oxford about the Economic Stimulus Act of 2008 allegedly utilized HUD’s label to mislead prospective borrowers into believing the letters were related to the federal government. The lawsuits are part of a “zero tolerance” campaign being waged by Koster, who promises to shut down Missouri mortgage scammers. “Increasingly, mortgage brokers are using deceptive ploys to draw Missourians back into the refinancing game,” Koster claimed. “This attorney general’s office will have zero tolerance for any mortgage broker or refinancing lender that uses deception to lure consumers into doing business with them.” |
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