Washington, DC) Attorney General Linda Singer and Commissioner Thomas E. Hampton of the Department of Insurance, Securities and Banking said today that 270 DC consumers are eligible for $233,889 in restitution from Ameriquest Mortgage Company and its affiliates as part of a $325 million multi-state settlement announced early last year.
The settlement resolves allegations by the District and the states that Ameriquest and its affiliates, among other things, misrepresented and failed to 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 used to qualify borrowers for loans.
Letters and claim forms were being mailed this week to DC consumers whose mortgage transactions qualified them for restitution under criteria developed by the settling states. To participate in the settlement and receive restitution, consumers must mail completed and signed forms to the settlement administrator by September 10, 2007.
The forms mailed to each consumer will show the minimum payment the consumer can expect to receive. However, the exact amount could be larger, depending on how many eligible District of Columbia consumers decide to participate in the settlement.
General Singer and Commissioner Hampton encouraged consumers to review the claim forms and information and reply as soon as possible. A “Frequently Asked Questions” pamphlet is being mailed with the claim form and provides additional information about the restitution process for eligible consumers.
Consumers who choose to receive the restitution payments will give up their right to file lawsuits against Ameriquest related to the loans covered by the settlement. For this reason, consumers may wish to consult with a private attorney or, if they qualify, a legal services attorney before deciding whether to participate in the settlement. However, consumers who participate in the settlement do not give up any claims they may otherwise raise if their homes go into foreclosure.
Under the national restitution program, which includes the District and every state except Virginia (where Ameriquest did not do business), 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 the restitution payments. Restitution payments nationwide are expected to total over $300 million.
Consumers can obtain more detailed information about the settlement and their eligibility for restitution by going to the Settlement Administrator’s web site: http://www.ameriquestmultistatesettlement.com/. Consumers also may contact the Settlement Administrator at (800) 420-5875. (Hearing-impaired persons may call (866) 494-8274.)
On April 26 of this year, General Singer announced, as part of her initiatives to address the high cost of being poor, the creation of a working group of investigators from the Department of Insurance, Securities and Banking and attorneys from the Office of the Attorney General and the Federal Trade Commission to investigate and prosecute predatory mortgage lending under the District’s consumer protection and banking laws.
Regarding the Ameriquest settlement, Commissioner Hampton said he was “very happy” to work with the Attorney General “to obtain this positive outcome for DC consumers and looks forward to working with her office to improve financial services available for all District residents.”
Consumers with questions about this action may call the Office of the Attorney General’s (“OAG”) consumer complaint hotline at (202) 442-9828 or contact OAG online at http://www.oag.dc.gov. OAG’s website also contains consumer education information and further information about how (and where) to make an effective consumer complaint.