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MoneyTalks - > Money Talks -> State attorney general accuses companies of "illegal" loans
State attorney general accuses companies of "illegal" loans

Here's a "raw report" straight from the office of California's attorney general:

(Read California's lawsuit here.)

LOS ANGELES — California Attorney General Edmund G. Brown Jr. today shut down Lifetime Financial, Nations Mortgage, Greenleaf Lending, Virtual Escrow, Olympic Escrow and Direct Credit Solutions, accusing the predatory lending companies of pushing homeowners into “illegal and unconscionable loans.”

“As the mortgage crisis worsens, a growing number of fly-by-night companies are employing utterly brazen tactics to push homeowners into illegal and unconscionable loans,” Attorney General Brown said. “The illegal sales practices of these companies, run by Eric Pony and his family, included psychological pressure, forgery, and outright lies,” Brown added.

The companies ran a complex predatory lending scheme using bait and switch tactics to victimize thousands of consumers in California, many of whom have lost their homes.

Yesterday, the Los Angeles Superior Court, at the request of the attorney general, froze all the companies’ real estate and bank accounts and enjoined them from engaging in further predatory practices. The freeze order also included expensive cars and millions of dollars in private real estate owned by Eric Pony. Brown also seeks an estimated $20 million in penalties and restitution.

In the coming weeks, Brown intends to bring additional legal actions, both civil and criminal, against other mortgage lenders and foreclosure consultants who are taking advantage of homeowners across California.

San Bernardino District Attorney Michael A. Ramos also announced that several individuals affiliated with Lifetime Financial were arrested this morning on charges including conspiracy, grand theft, forgery and elder abuse. “These predatory lenders have taken advantage of people who placed their trust, as well as their homes, in the hands of these unscrupulous business people,” San Bernardino District Attorney Ramos said.
 

Posted in these Groups:
Topics: California, real estate. mortgages, loans
posted by MoneyTalks on Tuesday, March 18, 2008 at 03:15 PM
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posted by cnclmark on Mar 18, 2008 at 07:51 PM

 Most individuals were aware three years ago that this real estate loan subprime market was going to cause this kind of crash. I remember sitting down with bankers who advised me and "others to keep your credit perfect,  maintain liquidity, and you will be a bankers prayer when this crashes". Now our Nanny government wants to bail out the loan institutions responsible for making these loans, bail out the borrowers who can't make today's payments that they didn't qualify for those loans at the time of their application. What should be the role of government? Some people reading this may have been forced to purchase very expensive PMI, (Private Mortagage Insurance), to cover the lenders if they defaulted on their obligation to make payments under their variable teaser rate trust deed and note. Some people weren't forced to purchase that insurance which only covers the lender's interests. Why should you have to pay to bail out greedy mortgage brokers who could have reasonably forseen their customers could not make payments? I am at a loss to come up with even one reason in their defense. Quit making your house payments and see who comes to your rescue.


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