State issuing Ameriquest refund forms
Eligible California customers who took out loans with Ameriquest Mortgage Co. from 1999 to 2005 will soon be receiving forms to claim a share of $51 million the company has agreed to pay to settle accusations of predatory lending practices.
The forms, which began being mailed Thursday by the state attorney general’s office, will go to an estimated 78,000 households that had mortgages with Orange-based Ameriquest.
Customers eligible for restitution were identified by an administrator hired by the states involved in the national settlement. They were determined to be customers who were improperly charged the highest rates for their loans.
Neither Ameriquest nor the attorney general’s office was able to say what percentage of Ameriquest customers during the six-year time frame was eligible to receive forms.
The settlement grows out of a 2006 suit in which Ameriquest agreed to pay $325 million to settle allegations by 49 states that from 1999 to 2005 it engaged in unlawful mortgage lending practices. These included misrepresented loan terms, hidden or excessive fees, inflated appraisals and fabricated borrower income statements.
It was the second-largest settlement of a predatory lending case, after a 2002 pact in which Household International agreed to pay $484 million.
The settlement also applies to some customers of two Ameriquest affiliates, Town & Country Credit Corp. and AMC Mortgage Services Inc. (formerly Bedford Home Loans).
To obtain payment, customers must complete, sign and return the release form by Sept. 10.
The attorney general’s office estimates that the average restitution payment will be $812.15, though the amount could increase depending on how many people choose to mail in their forms.
Borrowers who accept the payment will relinquish their right to sue the sub-prime lender unless their home goes into foreclosure.
“This is an important final step in Ameriquest’s January 2006 agreement with the states that will begin the process of distributing funds that have been made available for consumers,” said Ameriquest spokesman Chris Orlando.
Restitution checks are scheduled to be mailed in the fall.
Customers who believe they are eligible for restitution but don’t receive a claim form can call the Ameriquest settlement administrator at (800) 420-5875.