Lender Found Liable in Mortgage Fraud Case

Posted on January 10, 2009. Filed under: Case Law, Foreclosure Defense, Mortgage Fraud, Mortgage Law, Predatory Lending, right to rescind, Truth in Lending Act | Tags: , , , , , , , , , |

A Florida federal judge has found a mortgage lender liable to borrowers who say they were fraudulently put into unaffordable subprime mortgages.

U.S. District Judge Federico A. Moreno of the Southern District of Florida entered a default judgment against Bankers Express Mortgage Inc.

The judge said the Calabasas, Calif.-based lender did not respond to a lawsuit Maxo and Georgette Petit-Homme filed Aug. 14 and thus was liable for a to-be-determined sum of damages.

Another defendant, loan servicer Litton Loan Servicing LP, is seeking dismissal of the suit.

The Petit-Hommes, who are in foreclosure, sued Bankers Express and Litton in the District Court seeking to rescind the mortgage on their Miami home.

They claim that when they applied for a mortgage they provided the defendants with documentation about their income and financial assets.

The defendants, however, falsely increased the plaintiffs’ income on the loan application to make them eligible for an expensive $180,000 subprime loan with an interest rate of more than 10 percent, the suit says.

The Petit-Hommes claim that when they took out the loan in December 2006 they were unaware that the defendants had falsified their income.

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