DENVER – Colorado Attorney General John W. Suthers announced today that 11,575 Colorado consumers are eligible for $8.3 million in restitution from Ameriquest Mortgage Company – the nation’s largest sub-prime lender – and its affiliates as part of a $325 million national settlement of a predatory lending lawsuit against the company.
“The mortgage marketplace is a complicated and oftentimes confusing place to shop for a loan,” commented Attorney General Suthers. “Many consumers have difficulty understanding the terms of a mortgage, and companies that purposefully obfuscate the process should be held accountable for their deception.”
The settlement resolves allegations by the Attorneys General and finance regulators of 49 states, asserting that Ameriquest and its affiliates, among other things:
- Misrepresented and did not adequately disclose the terms of home loans, such as whether a loan carried a fixed or an adjustable rate;
- Charged excessive loan origination fees and prepayment penalties;
- Refinanced borrowers into improper or inappropriate loans; and
- Improperly inflated appraisals.
The Attorney General’s office began sending letters and claim forms to eligible consumers on Monday, July 9. All told, 11,575 Coloradans who entered loans worth more than one billion dollars are eligible for restitution. Individual Colorado consumers will receive payments between $123 and $3,462. To participate in the settlement and receive restitution, consumers must mail completed forms to the settlement administrator by September 10, 2007. More information can be found at www.AmeriquestMultistateSettlement.com, or by calling 800 420 5875.
“The sub-prime mortgage market is a volatile area of lending, and sub-prime loans continue to foreclose at a very high rate,” concluded the Attorney General. “My office will continue to scrutinize lending practices closely as the sub-prime lending pool continues its market correction.”
Under the national settlement, over 481,000 borrowers who were customers of Ameriquest Mortgage Company, Town and Country Credit Corporation, and AMC Mortgage Services, Inc. (formerly known as Bedford Home Loans) between January 1, 1999, and December 31, 2005, are eligible to receive restitution payments. Payments nationwide are expected to total nearly $300 million.