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National City Mortgage agrees to pay $4.6 million settlement in mortgage lawsuit.
Columbus, OH: (May-24-08) The Justice Department brought charges against Miamisburg-based National City Mortgage, the mortgage division of National City Corp., alleging that it submitted ineligible mortgages for federal backing. The federal agency stated that the mortgage company, which has been a part of the Cleveland-based bank since 1989, submitted 58 loans for insurance coverage through the Department of Housing and Urban Development's federal Housing Administration. The suit stated that the administration had loan payments more than 30 days past due during an audit period between May 2002 and April 2004.
Sources familiar with the nature of the dispute stated that National City Mortgage can underwrite FHA-insured mortgage loans for moderate- and low-income families, as well as submit them for federal endorsement. The catch is that, when it seeks FHA coverage more than 60 days after a closing for a late endorsement loan, it must certify loan payments are current.
The case, led by the Justice Department's civil division and the US Attorney General's Office for the Eastern District of Michigan, reached settlement with National City Mortgage agreeing to pay $4.6 million to the federal government to resolve allegations. National City spokespersons stated that the company denied the government's allegations, and didn't claim any liability. It was announced that the 58 loans in the settlement represent a fraction of 1% of the loans the company issued during the audit period.
National City Mortgage in the News[COLUMBUS BUSINESS FIRST: National City Mortgage]
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Published on Jun-4-08
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