| Lender to Pay Monumental Settlement
Household finance bites $484 million bullet August 7, 2003 By ANNE LINEBERRY |
| Household Financial will pay hundreds of millions of dollars to borrowers as a result of an investigation into the company’s lending practices.
The company will also be required to change some of its business practices, according to a website run by the settlement administrator. The website said that all 50 states as well as the District of Columbia agreed to the settlement and each will receive a portion of the monies. The $484 million settlement will be distributed by the state attorneys general and/or bank regulators to eligible people who took out mortgages from Household Finance or Beneficial between January 1999 and September 2002. According to the settlement administrator site, eligible borrowers will receive forms by the end of the month which must be filled out and returned in order to receive their portion. Disbursements will probably be made by the end of December, the website said. Though in order to receive payment, a borrower is required to forgo the opportunity to collect from Household regarding the disputed charges, borrowers can collect the settlement money and still pursue Household if the company is responsible for foreclosure, the website said. Prospect Heights, Ill.-based Household International will also be required to change business practices, the administrator said. “Any prepayment penalty provision now existing in any Household or Beneficial real estate secured loan made on or after January 1, 1999 will now be in effect only for the first 24 months of the real estate secured loan regardless of what the loan documents say,” the website said. Local media outlets across the country reported how much of the $484 million settlement would come to their home state. Here are a few:
The settlement administrator’s website includes links to the attorney general of every state so that consumers can gather information about the disbursement. According to Household, the states have also set up a toll-free number, 800.360.4316, for borrowers who need more information. Related story: Household May Settle With States for Up to Half Billion |
