U.S. Investigating Overcharges on Home Loans : Banking: Several agencies are looking into claims that borrowers may have paid up to $8 billion more than necessary on adjustable-rate mortgages.

Troubled by growing evidence that mortgage borrowers may have been overcharged by billions of dollars on adjustable-rate loans, federal regulators are taking a closer look at those loans in examinations of banks and thrifts.

The Office of the Comptroller of the Currency issued an advisory last month urging the 4,000 or so national banks to conduct internal audits of adjustable-rate mortgage pricing before examiners arrive.

The Federal Reserve Board, the Office of Thrift Supervision and the Federal Deposit Insurance Corp. have issued similar warnings and are gathering data to gauge the extent of the miscalculations of ARM rates.

The agencies are moving as concern escalates that banks and thrifts--including failed institutions now under government control--could be on the hook for what one former thrift regulator estimates is as much as $8 billion in overcharges.

The issue came to light last year when the former regulator, John Geddes, a consultant who monitors interest rates for borrowers, found adjustable-rate mortgages in the Midwest riddled with errors.

Many lenders are said to have miscalculated the periodic resetting of interest rates on the adjustable mortgages, which rose to popularity in the 1980s.

There is still no authoritative data on the extent of the problem nationwide, but a study released last week by the General Accounting Office hinted at it: Three analysts were quoted as estimating that 20 to 25% of the loans are incorrectly adjusted. A third expert put the error rate at 31%.

Hundreds of thousands of borrowers may be affected. Until about two years ago, the majority of new mortgages were being originated at adjustable rates; the proportion has since slipped to about 30%. The Mortgage Bankers Assn. of America estimates that nearly 4 million ARMs were originated by banks, thrifts and mortgage banks in 1987-89.

“I think all of us regulators are concerned,” said Michael Rouse, senior review examiner with the Federal Reserve Board’s division of consumer and community affairs. “We are all trying to make a detailed effort to see what the scope of the problem is.”

“It’s a serious problem,” said David Ginsburg, president of Loantech Inc., a mortgage consulting firm in Gaithersburg, Md. “. . . There are a lot of errors out there, and they are costing lenders and borrowers money.”

Armed with data from Geddes, mortgage borrowers in Indiana and Ohio have filed a spate of lawsuits in recent months seeking damages from savings institutions as large as $5-billion-asset TransOhio Savings Bank in Cleveland.

Geddes, who is chief executive of Consumer Loan Advocates Inc. in Lake Bluff, Ill., says thrifts are not the only institutions guilty of overcharging.

“I know of problems in Florida, Kentucky, Oklahoma and Texas,” he said. The Southwest “has a wide-scale problem that nobody is talking about.”

A former employee of the Federal Savings & Loan Insurance Corp., Geddes blew the whistle on Midwestern S&Ls; in 1989. He conducted a study of more than 7,000 adjustable-rate loans made by dozens of failed thrifts and found that borrowers were overcharged nearly half of the time.

Loantech also studied 400 ARMs at banks and S&Ls; and found errors in 28% of the loans.