|Countrywide Home Loans has been named as a defendant in a lawsuit because it allegedly approved a borrower for stated income financing on $1 million in properties even though his annual income was only $30,000. The filing of the lawsuit appears to be motivated, however, by a significant drop in the value of the properties involved.
Igor Doncov alleges that the lender gained approval through a “stated income” loan by overstating income he did not disclose or approve, according to a lawsuit filed in the Clark County District Court of Nevada.
Del Webb Communities Inc., a subsidiary of Pulte Homes, is the primary defendant in the suit.
According to the lawsuit, Doncov executed two purchase agreements in February with Del Webb for the two Las Vegas, Nev., properties. The combined price of the two homes was $780,800 for which he put down about $48,000 in escrow, the suit said.
Doncov previously bought two homes in the same area from Del Webb for which he is currently paying over $7,500 monthly. For the four properties, priced at $1.5 million at the time of contract, Doncov’s payments would increase to $15,000 each month.
The San Mateo, Calif., resident alleges he has not been able to sell the two previously purchased homes because Del Web “created an instant loss” of $100,000 on the properties when it slashed prices on new homes within the community last month.
Doncov’s 2003 income was just over $30,000 and he has “no means to make the monthly payments on the two homes he currently owns, and it would be impossible for him to make a single payment on the two homes” in escrow, the suit said.
When he realized he would be “unable to qualify for any type of lending at this time,” Doncov attempted to cancel the contracts with Del Webb and retrieve his deposit money. However, the community builder refused to do so because Countrywide had already qualified and approved him to close on the two transactions, the suit said.
Doncov alleges Countrywide engaged in fraudulent lending practices because it overstated his “income in an effort to force him to close on a transaction that no lending institution would ever approve based on his income.“
Countrywide said it does not comment on any pending litigation.
The man is reportedly seeking relief from the lender for the fraudulent practices and for punitive damages.
So, you’re interested in refinancing your mortgage. Maybe you want some extra capital to do that home project you’ve always dreamed of, interest rates are nearing record lows, or you want to start consolidating debt. Regardless of the motivation behind the refinance,...