Guild Mortgage to pay $25M in federal lawsuit settlement
October 26, 2020
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In today’s Daily Download episode, HousingWire covers an announcement that Guild Mortgage has agreed to pay $25 million dollars to settle a federal lawsuit.
For some background on the story, here’s a summary of the article:
Just before its stock debuted at a disappointing $15 a share, Guild Mortgage settled a federal lawsuit that claimed the lender knowingly breached legal requirements when it originated and underwrote FHA loans.
Guild agreed to settle the federal lawsuit, brought by the Department of Justice, for just under $25 million, the government said Thursday. It did not admit to any wrongdoing.
The lawsuit, brought initially in 2016, alleged that Guild knowingly originated and underwrote mortgages that didn’t meet the program requirements of the FHA. Those loans, originated between 2007 and 2011, defaulted and led to claims to the FHA for mortgage insurance. Guild failed “to comply with material program rules that require lenders to maintain quality control programs to prevent and correct underwriting deficiencies, and failed to self-report materially deficient loans that it identified,” the government said.
“As this settlement demonstrates, we are committed to holding mortgage lenders accountable when they choose to abuse the integrity of vital government programs that are designed to assist homeownership,” U.S. Attorney Robert Brewer for the Southern District of California said in a statement. “We also commend the whistleblower for coming forward, exposing these wrongs, and working with the government investigative team.”
Following the main story, HousingWire covers the Federal Housing Administration’s new Automated Underwriting System and a report from Redfin that suggests the luxury housing market has inspired a frenzy in vacation boom towns.
The Daily Download examines the most compelling articles reported from the HousingWire newsroom. Each afternoon, we provide our listeners with a deeper look into the stories coming across our newsroom that are helping Move Markets Forward. Hosted by the HW team and produced by Alcynna Lloyd.
HousingWire articles covered in this episode:
