April 16, 2014
The state of Massachusetts is suing a California subprime mortgage lender, accusing it of unfair practices that contributed to the current spike in home foreclosures.
The lawsuit against Brea-based Fremont Investment and Loan comes
three months after the attorney general reached an agreement that restricted the company's ability to foreclose on its mortgage loans in Massachusetts.
That agreement included a 90-day review period, and now prosecutors are suing for a court order to keep the foreclosure restrictions in place.
The lawsuit also seeks civil penalties and restitution.
The attorney general says Fremont used unfair practices to secure mortgage business, including failing to require borrowers to provide proof of income.
Fremont says the lawsuit is "without merit."