Orange County Register: Ameriquest settles excessive-fees allegations

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Friday, July 15, 2005

Ameriquest settles excessive-fees allegations
Mortgage firm to issue more than $7 million to customers whose payments exceeded state law.

By ANDREW GALVIN
The Orange County Register

Ameriquest Mortgage Co., the nation's biggest subprime lender, and four of its affiliates agreed Thursday to pay more than $7 million to settle allegations by the Connecticut Department of Banking that they charged excessive fees to people who refinanced existing Ameriquest loans.

Ameriquest, based in Orange, makes mortgage loans to people with tarnished credit histories or who have other difficulties getting credit. In the first quarter of this year, it originated an estimated $24 billion of such subprime loans, more than twice as much as its closest competitor, Irvine's New Century Financial Corp., according to National Mortgage News.

Thursday's settlement came after the Connecticut banking department accused Ameriquest of charging prepaid finance charges that exceeded the greater of 5 percent of the loan amount or $2,000 from customers who were refinancing earlier loans obtained from Ameriquest within two years. Those fees, charged in at least 364 instances by Ameriquest or its affiliates, exceeded limits set by state law, the department said. The department also accused Ameriquest of failing to register certain of its employees as loan originators.

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http://www.ocregister.com/ocr/2005/07/15/sections/business/oc_region/article_597844.php