Ameriquest – Predatory Lending Settlement
For property owners and attorneys who are dealing with Ameriquest, Ithought it would be useful to post an article about the settlement regarding the allegations of predatory lending. Here is the article from The Business Review:
Ameriquest settles over predatory lending allegations
The Business Review (Albany) – January 23, 2006
New York’s Eliot Spitzer joined with attorneys general from 47 other states Monday in making a settlement with the Ameriquest Mortgage Co. that will produce an estimated $22 million in restitution for more than 22,000 New York state residents.
Spitzer said an investigation of Ameriquest, the country’s largest subprime mortgage lender, indicated that the company used a “hyper-aggressive, high-pressure” sales culture that encouraged sales people to engage in abusive and predatory lending practices.
Ameriquest’s sales people concealed the interest rate and loan costs that consumers could expect during some transactions, according to Spitzer. They also charged consumers thousands of dollar in discount points that didn’t lower interest rates on loans, according to the settlement.
Under the settlement, Ameriquest will provide better information to prospective customers, and put it in writing; provide good-faith estimates and refrain from soliciting consumers to refinance mortgages two years from when they initially got their mortgages.
The company agreed to an overall settlement of $325 million, $295 million in restitution and $30 million in payments to the states involved in the investigation.
ACC Capital Holdings Corp., the Orange, Calif., parent company of Ameriquest, said it was acknowledging no wrongdoing by entering into the agreement with the attorneys general.
“Doing the right thing for the people we serve has always been one of our core values,” said a statement from ACCCH’s CEO, Aseem Mital. “We regret those occasions when our associates have not met this ideal to our customers’ expectations.”