Ameriquest Mortgage Refinancing

Crossposted from Inexpensive Home Building

The mainstream media are finally doing many stories on risky mortgages. Ameriquest was one of the first bubble lenders to admit financial trouble.

From Wikipedia:

Ameriquest is one of the United States's leading wholesale sub-prime lenders. It is a private company, owned by Roland Arnall, founded in 1979, in Orange County, California, as a bank, Long Beach Savings & Loan. The bank moved to Orange County in 1991 and was converted to a pure mortgage lender in 1994, renamed Long Beach Mortgage Co. In 1997, the wholesale part of the business (funding loans made by independent brokers) was spun off as a publicly traded company, called Long Beach Mortgage; the retail part of the business was renamed Ameriquest Capital and remained private. (In 1999, Washington Mutual purchased Long Beach Mortgage.)

Ameriquest is best known for its subsidiary, Ameriquest Mortgage Company, which makes direct loans to customers. Its Argent Mortgage Company affiliate works with independent brokers. It has offices nationwide, and more than 12,000 employees. Other subsidiaries are Ameriquest Mortgage Securities, Long Beach Acceptance Corp., and Town & Country Credit.

Ameriquest was among the first mortgage companies to use computers to search for prospective borrowers, and to speed up the loan process.

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Sub-prime lenders made $587 billion in new mortgages in 2004, up from $390 billion in 2003, according to National Mortgage News. Ameriquest's share of that is estimated at over $50 billion.

In 1996, , the company paid $3 million to settle a Justice Department lawsuit accusing it of gouging older, female and minority borrowers. Prosecutors accused it of allowing mortgage brokers and its employees to add a fee to these customers of as much as 12% of the loan amount.

In 2001, after being investigated by the Federal Trade Commission, the company settled a dispute with ACORN, a national organization of community groups, promising to offer $360 million in low-cost loans.

On 1 August 2005, Ameriquest announced that it would set aside $325 million to settle attorney general investigations in 30 states. In at least five of those states — California, Connecticut, Georgia, Massachusetts, and Florida — Ameriquest has already settled multimillion-dollar suits.

In May, 2006, Ameriquest Mortgage announced it was closing all of its retail offices, and will emphasize in the future its loans through brokers, a channel that is not covered by the predatory lending settlement with the Attorneys General.

The issues confronted by companies like Ameriquest are considered by many industry experts to be the major contributing factor to the rapid rise of Certified Mortgage Planners, certified industry experts that work in concert with Certified Financial Planners in harmonizing the home finance products utilized by consumers with their larger financial portfolios.