Wholesaler Liable for Broker Discrimination
The government has essentially settled with itself over alleged discriminatory practices by mortgage brokers on loans closed and funded through a defunct subprime wholesaler. The government claims the settlement marks the first time a wholesale lender has been held accountable for such broker behavior.
The U.S. Department of Justice announced yesterday that Wilmington Finance Inc. was among two companies to settle charges of discrimination against blacks.
Wilmington's wholesale unit ended originations in June 2008 following the June 2006 consolidation of retail operations and the ouster of its founder and chief executive officer a month earlier.
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2 Wells Fargo Units Face Lawsuits
In two recent lawsuits, subsidiaries of Wells Fargo & Co. are accused of targeting minorities for predatory loans, causing increased foreclosures and violating a law protecting military personnel. In other mortgage-related litigation, a Texas-based company is being sued by North Carolina, while another Texas mortgage firm is suing former employees over alleged fraud.
Bankruptcy Litigants Busy
Recent mortgage-related litigation includes a case against an Alabama bank accused of lending discrimination, a $4 billion lawsuit filed by Bank of America Corp. and a suit against IndyMac Bank. One of three cases tied to corporate bankruptcies has been settled.
California Enacts Several New Mortgage Laws
Loan originators, reverse mortgage lenders and appraisal management companies are all impacted by sweeping new mortgage laws in California. Lenders to non-English speaking borrowers and lenders on higher priced loans are also impacted.
Wholesale, Alt-A Analyzed in University Report
A report from Columbia University challenges the mortgage broker model and blames life experiences -- not lender discrimination -- for a disparity in delinquency between whites and minorities.
Mortgage Litigation Today
Issues addressed in recent mortgage lawsuits include lending discrimination, mortgage fraud and political contributions by two of the country's biggest mortgage firms. In another case, a former employee of a failed reverse mortgage lender who was accused of stealing 56,000 mortgage leads has pleaded guilty.
New Mexico Lenders Face Big Changes
Sweeping changes to mortgage lending laws in New Mexico that take effect at the end of this month are expected to impact lending in the state. Among the changes are restrictions on adjustable-rate loans, prepayment penalties and income verification.
Final Payment on Original 'Biggest Settlement'
Long before the Ameriquest and Countrywide settlements, there was the settlement with First Alliance Mortgage Co. -- which was touted as the biggest ever at the time by the government. With a huge recent payment to 15,000 of its borrowers, the defunct subprime lender has completed its obligations under the settlement.
Collection Calls Lead to Judgment
A federal judge has awarded a New Hampshire woman $200 per telephone call for hundreds of calls allegedly made by Ameriquest Mortgage Co. after she asked the company to stop harassing her. But the judge dismissed claims by the woman -- who represented herself in federal court -- of predatory lending.
