Get Your Mortgage Rate Quote in Just 30 Seconds

Mortgage rates change every day, and your rate will vary based on your location, finances, and other factors. Get your FREE customized rate comparison below.

NY Lender Banned from FHA

NY Lender Banned from FHAU.S. v. Madison Home Equities

April 29, 2009

By MortgageDaily.com staff

A New York lender has been accused of defrauding the government on $4 million in mortgages and has been banned for life from government originations.U.S. District Judge Nicholas G. Garaufis has approved a consent decree and judgment against Madison Home Equities Inc., according to a statement yesterday from the U.S. Attorney for the Eastern District of New York in Brooklyn.

Also named is Nadine Malone, president of the Long Island-based lender.

The action resolves a civil lawsuit filed in October 2008 that accuses the defendants of running a scheme to defraud the U.S. Department of Housing and Urban Development. A temporary restraining order issued at the time prevented Madison from originating loans insured by the Federal Housing Administration. The latest action makes that order permanent.

Madison, a direct endorsed FHA lender, allegedly certified that borrowers on $4 million in FHA-insured loans were qualified for the government-insured program — even though they were not.

The decree and judgment permanently enjoins Madison and Malone from making FHA loans. They are also banned from utilizing any other government mortgage program.

In addition, the defendants have agreed to pay penalties and indemnify HUD for any losses on loans it originated.

“In these difficult times, the HUD Office of Inspector General, working with U.S. Attorneys across the nation, will use all appropriate means to isolate and hold accountable mortgage companies like Madison Home Equities, and their principals, whose fraudulent conduct jeopardizes the integrity of HUD’s FHA mortgage insurance program,” HUD Inspector General Kenneth Donohue said in an earlier announcement.

next story

back to current headlines

Popular posts

7 Refinance Strategies
7 Refinance Strategies

Refinance to a lower interest rate: If interest rates have dropped since you took out your original mortgage, refinancing to a lower rate can help you save money on your monthly payments and reduce the overall cost of your loan. Refinance to a shorter loan term:...

7 Refinance Strategies
Is Refinancing With Your Present Lender Preferable?

Do Not Accept the First Refinancing Offer You Receive Homeowners should not accept the first refinancing rate provided to them. This is particularly important if you are applying with your existing lender. Some mortgage lenders have mechanisms in place that prioritize...

Newsletter

Don’t worry, we don’t spam

calculate your monthly mortgage payment

Related Topics

Helpful Links

Daily mortgage rate trends

Best mortgage lenders

First-time homebuyers programs by state

Loan limits by state

Types of mortgages

APR vs interest rate

Understanding PMI

Related Posts

Fannie Mae Profile

Fannie Mae Profile

Last Updated December 27, 2018 7:38 PM Central   full list | other directories | bank search | SEC...

THE TRUSTED PROVIDER OF ACCURATE RATES AND FINANCIAL INFORMATION