The Department of Housing and Urban Development’s Mortgage Review Board has suspended Houston-based Allied Home Mortgage Corporation and its company CEO for violating Federal Housing Administration requirements and concealing those violations. Ginnie Mae has also suspended the company from issuing mortgage-backed securities.
“We will not tolerate mortgage lenders who play fast and loose with FHA’s standards,” said HUD’s General Counsel Helen Kanovsky during a news conference. “These defendants demonstrated a pattern of recklessness and utter disregard for how we do business. They’ve harmed FHA, hurt homeowners, and now they’ll be held to account for their actions.”
Allied originated loans from unapproved branch offices in violation of FHA requirements and then covered up the violations through the submission of false information, HUD stated in a press release. Among the company’s violations, which included false certification, failure to ensure that its corporate entity paid the operating expenses of its FHA-approved branch offices and failure to implement a quality control plan in compliance with HUD/FHA, the company submitted false information about where its loans were originated.
HUD is suspending the company’s president and CEO, James Hodge, as well as the company’s executive vice president, Jeanne Stell.
Allied Home Mortgage Corporation originated 133 reverse mortgages in 2010 and has originated 66 reverse mortgage loans to date this year, according to data from ReverseBase and HECM World’s top 100 HECM Lenders Report.
Written by Elizabeth Ecker