DOJ: Lending giant lied about FHA-backed loans

by Ryan Smith24 Apr 2015
Quicken Loans is being sued by the Department of Justice, which alleges the lending giant lied to the government about loans backed by the Federal Housing Administration.

Between 2007 and 2011, Quicken originated hundreds of FHA-backed loans that shouldn’t have been eligible for government insurance, according to the DOJ. Justice also claims that Quicken pushed back on appraisals when homes received too low a valuation to qualify for a loan and that the company’s own management team expressed concerns about its underwriting practices, according to a Wall Street Journal report.

“Those who do business with the United States must act in good faith, including lenders that participate in the FHA mortgage insurance program,” DOJ Principal Deputy Attorney General Benjamin C. Mizer said in a statement. “To protect the housing market and the FHA fund, we will continue to hold responsible lenders that knowingly violate the rules.”

Quicken itself filed a pre-emptive lawsuit against the DOJ and the Department of Housing and Urban Development less than a week ago, alleging the agencies were attempting to coerce it into admitting to claims of fraud it says it didn’t commit, the Journal reported.
 

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