Home / News / Government / Minnesota AG Sues Mortgage Firm for Alleged Refinance Scam
Print This Post Print This Post

Minnesota AG Sues Mortgage Firm for Alleged Refinance Scam

""Minnesota Attorney General Lori Swanson"":http://www.ag.state.mn.us filed a lawsuit Monday against Meredian Financial Corporation, a California-based mortgage lender and broker.

According to a statement from the attorney general, the lender charged Minnesota homeowners thousands of dollars in fees to refinance their mortgages, but the refinances did not happen.

[IMAGE] [COLUMN_BREAK]

""Meredian targeted homeowners struggling in the troubled economy who were looking to get out of an adjustable-rate mortgage or lower their interest rate by refinancing,"" said Swanson. ""The company masqueraded as the homeowner's current lender and convinced them to pay thousands of dollars in fees but left homeowners with the short end of the stick.""

The lawsuit alleges that Meredian also made numerous false claims, including low fixed rates, no out-of-pocket expenses, no appraisal requirement, and underwriter approval to demand up-front ""rate-lock"" fees typically between $1,000 and $4,000.

While homeowners were promised fee refunds at closing, Meredian would cease work on the loan file once it obtained the fees. Homeowners were then denied refunds, according to the attorney general's office.

Swanson also issued an alert to homeowners about predatory mortgage refinancing, warning them to research companies beforehand, get promises in writing, shop around for the best loan, and avoid giving in to pressure.

About Author: Heather Cernoch

x

Check Also

Senate Hearing Tackles National Flood Insurance Program Reauthorization

Senate Banking Committee Chair Sharrod Brown recently held a hearing to discuss the future of the National Flood Insurance Program, featuring a panel of experts highlighting the many repercussions of an expiration in the program.