California Real Estate Fraud Report

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07
Jul

Prospect Mortgage to Pay $4.157 million in Penalties to Resolve Fraud Allegations

Prospect Mortgage Company is set to pay a penalty of $4.157 million to resolve claims by several attorneys general that it committed mortgage fraud while participating in the government’s Direct Lender Endorsement Program.

According to federal prosecutors, Prospect Mortgage defrauded the government during and after the run-up to the housing crisis through its participation in the Direct Endorsement program, which the feds claim cost taxpayers millions.

The program is administered by the Federal Housing Administration and the Department of Housing and Urban Development. As a DE lender, Prospect was able to originate, underwrite and endorse mortgages for FHA insurance. But the U.S. Justice Department alleged that Prospect falsely certified that the FHA-insured loans it had originated complied with critical quality-control requirements, when they did not.

Prospect Mortgage sold its operating assets to HomeBridge Financial in February 2017.

Read the original article in Mortgage Professional America.

© Copyright 2007-2017 Monique Bryher

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The information and notices contained on The California Real Estate Fraud Report are intended to summarize recent developments in real estate fraud, mortgage fraud, short sale fraud, REO fraud, appraisal fraud, loan modification scams, loan modification fraud and other real estate related crimes occurring in Los Angeles and California. The posts on this site are presented as general research and information and are expressly not intended, and should not be regarded, as legal advice. Much of the information on this site concerns allegations made in civil lawsuits and in criminal indictments. All persons are presumed innocent until convicted of a crime. Readers who have particular questions about real estate fraud, mortgage fraud and appraisal fraud matters or who believe they require legal counsel should seek the advice of an attorney.

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