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Massachusetts AG Obtains Injunction to Review Lender’s Foreclosures

""Massachusetts Attorney General"":http://mass.gov/ag Martha Coakley’s office announced last week that it has secured a preliminary injunction against subprime lender ""Option One Mortgage Corp."":http://www.oomc.com and its parent company ""H&R Block Mortgage Corp."":http://www.hrblock.com/mortgages/index.html, whom the Attorney General has accused of deceptive mortgage practices. According to Coakley, Option One and H&R Block ""engaged in unfair and deceptive conduct on a broad scale by selling extremely risky loan products to Massachusetts consumers that the companies knew or should have known were destined to fail.""
The injunction, granted by Judge Ralph D. Gants in ""Suffolk Superior Court"":http://www.mass.gov/courts/courtsandjudges/courts/superiorcourt/, prevents Option One and H&R Block from initiating or advancing foreclosures on loans that may have been secured using unfair business practices. The Attorney General’s office alleges that the two companies originated thousands of risky subprime loans in Massachusetts, with reckless disregard as to whether borrowers would be able to afford their loan payments - a practice that the Attorney General says has contributed significantly to the foreclosure crisis in Massachusetts. The Attorney General also alleges that the companies discriminated against minority borrowers in Massachusetts by charging them higher points and fees to close their loans than white home buyers.
""American Home Mortgage Servicing Inc."":http://ahmsi3.com/servicing/home.asp purchased Option One’s servicing platform from H&R Block earlier this year and now services nearly 9,700 Bay State home mortgages for Option One. Under the order, American Home must give the Attorney General’s office at least 30 days notice before it intends to foreclose on any home loan that might be considered ""presumptively unfair,"" and if the Attorney General objects, obtain approval from the Court before foreclosing on a loan.
""We are pleased by the court’s decision and the relief it will afford, both to homeowners and to the communities suffering from the effects of Option One’s loans,"" said Attorney General Coakley in a ""statement"":http://www.mass.gov/xpageID=cagopressrelease&L=1&L0=Home&sid=Cago&b=pressrelease&f=2008_11_12_option_one_pi&csid=Cago. ""The economic crisis continues to worsen, and predatory subprime lending is at the core of the problem. This decision is further support that some subprime lenders engaged in irresponsible and unlawful lending practices. We intend to hold accountable those who engaged in such unlawful lending conduct.""

About Author: Carrie Bay

Carrie Bay is a freelance writer for DS News and its sister publication MReport. She served as online editor for DSNews.com from 2008 through 2011. Prior to joining DS News and the Five Star organization, she managed public relations, marketing, and media relations initiatives for several B2B companies in the financial services, technology, and telecommunications industries. She also wrote for retail and nonprofit organizations upon graduating from Texas A&M University with degrees in journalism and English.

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