Mortgage News

  City Sues Countywide to Stop Foreclosures
San Diego's city attorney announced that a civil complaint was filed in San Diego Superior Court by his office's Consumer and Environmental Protection Unit against Countrywide Financial Corp. San Diego accuses Countrywide of engaging in a "pattern of unlawful, fraudulent or unfair predatory real estate lending practices." The alleged activities have left a number of the city's residents facing foreclosure. San Diego seeks civil penalties and injunctive relief that will prevent Countrywide from starting or proceeding with foreclosures on owner-occupied properties located in San Diego that secure ARMs with teaser rates made to subprime borrowers.

New ResCap CEOs
Thomas Marano has been named chief executive officer of Residential Capital LLC, an announcement said. Marano replaces Jim Jones. Marano was named non-executive chairman of the Minneapolis-based unit in April.

Losses, Lawsuits and Solvency
MGIC Investment Corp. reported a $98 million second-quarter loss as a result of falling home values, a softening economy and elevated delinquencies and foreclosures. IAC Interactive Corp. will take a $100 million charge tied to goodwill and intangible assets of its lending segment, which includes LendingTree, according to a filing with the SEC Tuesday. Franklin Bank Corp. is facing its third investor class-action lawsuit since May. The American Bankers Association issued a press release supporting a Pennsylvania federal court ruling that found the National Credit Union Administration went too far in establishing a 3,400-square-mile area as well-defined for determining credit union membership. The Office of Thrift Supervision's director told attendees at an ABA meeting Monday that recent news reports about ailing financial institutions have shaken public confidence in the banking system.

Majority of Subprime Borrowers Single
ComplianceTech announced a new analysis of Home Mortgage Disclosure Act data. The report was based on 1.9 million subprime-rate mortgages originated in 2006. Borrowers with no co-applicants accounted for 65 percent of subprime loans.

$500k Fine, License Revocation for Calif. Co.
Washington's Department of Financial Institutions announced that it intends to revoke the license of Paramount Equity Mortgage Inc. In addition, the state is issuing a $500,000 fine against the company, demanding nearly $10,000 in examination and investigation fees and requiring restitution for borrowers. The California-based company is accused of using deceitful advertising, faulty disclosures and unlicensed originators.