Questionable mortgages appear headed for court
By PHUONG CAT LEP-I REPORTER
Michelle Miran didn't realize that there was something wrong with her mortgage until the interest rate reset last year.
Her truth-in-lending statement – the legally required disclosure of loan rates and estimated costs – noted a 30-year fixed rate with monthly payments of $1,311 for 359 months. But two years into it, her monthly payment shot up to about $1,700, and she and her husband fell behind.
They're now fighting foreclosure on their Tacoma home and fighting back in court, suing the mortgage broker and lender.
The state Department of Financial Institutions has filed administrative charges against a dozen consumer loan companies so far this year, already twice as many as it did last year. Those companies include Countrywide, NovaStar and American General.
"There's been such a national outcry about bad loans that regulators are stepping up to the plate more and trying to do something," said Kurt Eggert, a professor at the School of Law at Chapman University in Southern California and a former member of the Federal Reserve Board's Consumer Advisory Council.
"There's pressure on state officials to do something about it."
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