Ameriquest Payments May Be Near

Thursday, February 08, 2007

by David Flaum


The checks aren't in the mail yet, but details of the year-old settlement for repaying some Ameriquest mortgage customers indicate the payment day may be nearing.

Early last year, California-based Ameriquest Mortgage Co. and related firms agreed to pay customers $295 million and change their lending prac­tices. That came after attorneys general in the District of Columbia and 49 states — all but Virginia, where the company does no business — inves­tigated the company's lending prac­tices.

Under terms of the settlement agree­ment, the money will be divided into two funds — $175 million will go to people who borrowed from an Ameriquest company from Jan. 1, 1999, to April 1, 2003. and $120 million will be paid through the states in pro­portion to the number of borrowers they had getting loans from Jan. 1, 1999, to Dec. 31, 2005.

"If you're eligible, you'll be sent a no­tice letter in April 2007 that will tell you the minimum dollar restitution payment you may receive," said a note on a Web site set up by the settlement administra­tor, Rust Consulting of Minneapolis.

"To accept your payment, you must sign and return, by the deadline indi­cated in the letter, a release form that will be included with your notice let­ter," the note said.

People won't give up their rights to challenge a foreclosure if they sign the letter, the consultants said.


Amounts: $295 million for borrowers, $30 million for states to cover investigation costs.

Agreement made: Jan. 23, 2006, with attorneys general of 49 states and District of Columbia.

Notices to be sent to eligible borrowers: April 2007.

Deadline for return: To be indicated in notice.

The note did not indicate when people who sign letters may get their money.

In Tennessee, about 2,500 borrowers may be eligible for payments totaling $2.5 million, said Sharon Curtis-Flair, spokeswoman for the state attorney general.

About 1,400 Arkansans would be in line to get a total of $670,000, said Gabe Holmstrom, spokesman for the Arkansas attorney general. 

No figures were available from Mis­sissippi.

Although the agreement doesn't re­quire Ameriquest to change terms of mortgages covered by the settlement, the company agreed to a long list of changes in its lending practices. 

Those range from charging the same rates of interest to borrowers in similar circumstances to not proposing refi­nancing in the first two years of a loan.

"Our assessment is that they are com­plying," said Bob Brammer, spokesman for Iowa Attorney General Tom Miller, one of the lead lawyers in the case.

— David Flaum 529-2330

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