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US Mortgage Provider to Pay 123.5Mln in Settlement for Lending Violations

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The US Department of Justice stated that MetLife Home Loans will pay $123.5 million to the United States to settle a case in which it knowingly violated the law.

WASHINGTON (Sputnik) — MetLife Home Loans will pay $123.5 million to the United States to settle a case in which it knowingly violated the law by originating and underwriting mortgage loans insured by the US Federal Housing Administration (FHA), the US Department of Justice said in a statement.

“MetLife Home Loans LLC has agreed to pay the United States $123.5 million to resolve allegations that MetLife Bank N.A. violated the False Claims Act by knowingly originating and underwriting mortgage loans,” the statement, issued on Wednesday, said.

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Under the settlement, MetLife will admit it certified FHA insurance mortgage loans from 2008 to 2012 that did not meet US Department of Housing and Urban Development (HUD) underwriting requirements, the statement said.

Between 2009 and 2010, the most serious category of deficiencies that MetLife labeled “material/significant” ranged from 25-60 percent, and the findings were routinely shared with MetLife higher-ups, the statement added.

Between 2009 and 2010, MetLife pinpointed 1,097 FHA mortgage loans underwritten with a “significant” classification, despite the obligation to report findings of material violations of FHA requirements, the statement said.

According to the statement, the FHA suffered significant losses after it paid insurance claims on the loans.

The settlement resulted from a join investigation by HUD, the Office of Inspector General, and the US Attorney’s Office for the District of Colorado, the statement said.

 

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