Weather Advisories, Watches and Warnings

Quicken Loans to pay $32.5M to settle lawsuit over bad loans

DETROIT (AP) — Quicken Loans has agreed to pay $32.5 million to settle a lawsuit that accused the company of fraudulently sticking the government with bad mortgages.

The deal was disclosed Friday, and the case was dismissed by a Detroit federal judge.

The government had accused Quicken of cutting corners when verifying the income of certain borrowers. Quicken also was accused of seeking improper appraisals so it could make a larger mortgage. The loans were insured by the Federal Housing Administration, which paid Quicken if a borrower defaulted.

Quicken denied the allegations. Vice chairman Bill Emerson tells the Detroit Free Press that the company did “nothing wrong” but paid for losses involving “human error.” Quicken will remain in the FHA program.

Quicken’s founder is Detroit businessman Dan Gilbert, who owns the NBA’s Cleveland Cavaliers. He is recovering from a stroke.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Google photo

You are commenting using your Google account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

Notice: you are using an outdated browser. Microsoft does not recommend using IE as your default browser. Some features on this website, like video and images, might not work properly. For the best experience, please upgrade your browser.