Ameriquest Accused of Excessive Fees & Altered Terms

Chrissie Cole

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Stemming back as far as 2005 and earlier, Ameriquest Mortgage has been facing lawsuits from over 29 states nationwide over allegations of deceptive sales practices.

In August 2005, Ameriquest announced they had reached a tentative $325 million settlement for customers who alleged the subprime lender charged them excessive fees and changed the agreed terms on their loans when they went to sign the final loan documents.

Several lawsuits have been seeking class-action status. In particular, Massachusetts borrowers say their loan fees and interest rates differed from what they had agreed upon when negotiating the refinance of their homes.

Ameriquest claims they uniformly promised to refinance the homeowners a second time, sometimes within months, on more favorable terms to help offset additional fees.

Investigators found Ameriquest in violation of state lending and consumer laws, used ''bait and switch" tactics in often unsolicited phone calls to potential customers, did not disclose steep penalties charged for paying loans off early, and falsified borrowers' incomes to ensure they would qualify for the loan, said officials briefed on the multistate investigation.