money manager ex convers from quicken problems

She recalled selling a loan to a customer who had cancer and needed cash to pay medical bills: 'I could have offered him a home equity line of credit to pay these bills but, instead, I sold him an interest-only ARM that re-financed his entire mortgage. As in the Duncan case, the company was also accused of arranging a bogus appraisal on her home, overstating its worth by more than $135,000.Ī former Quicken loan consultant supports the sense that such borrowers were ill-served, claiming that supervisors pressured her to sell ARMs to customers who would have been better off using another product. Although the homeowner claimed to have expressed concern about the cost of the mortgage, a Quicken loan officer allegedly told her that 'the affordability of the monthly payment was not an important consideration' because the company could refinance the loan in a few months at a lower interest rate. Duncan's lawyer said she later tried to sell the home, but failed because the property's value was worth less than what she owed on her loans.Īnother borrower accused Quicken of not explaining the terms of a balloon loan, which she couldn't afford. (On its Web site, Quicken says it doesn't currently offer interest-only products because of 'market conditions.') The company and a third-party appraisal firm inflated the value of her house by nearly $40,000, she alleged. One Ohio County, W.Va., resident, Janyce Duncan, filed a complaint after Quicken in 2005 put her into a $109,000 interest-only loan and a $27,000 home equity credit line. Meanwhile, multiple borrower lawsuits against the company center on its issuance of ARMs. He claimed managers pressured salespeople to boost their commissions by 'locking the customer into a higher interest rate, even if they qualified for a lower rate, and rolling hidden fees into the loan.' Quicken uses similar methods, said a former loan salesman at the company in a sworn statement. Īs Hudson recently documented in his book, The Monster: How a Gang of Predatory Lenders and Wall Street Bankers Fleeced America - and Spawned a Global Crisis, aggressive sales tactics were a hallmark of the abusive lending that led to the housing crash.

Documents in the case also claim that the company encouraged some borrowers to overstate their income. In the Michigan suit, former employees are seeking overtime pay they say Quicken owes them. In court papers, former salespeople claim Quicken executives managed by bullying and intimidation, pressuring them to falsify borrowers' incomes on loan applications and to push overpriced deals on desperate or unwary homeowners. They accuse the company of using high-pressure salesmanship to target elderly and vulnerable homeowners, as well as misleading borrowers about their loans, and falsifying property appraisals and other information to push through bad deals.Ī group of ex-employees, meanwhile, have gone to federal court to accuse Quicken of abusing workers and customers alike. Quicken has also capitalized on that image, touting its high ranking in consumer surveys, top grade from the Better Business Bureau and repeated listing by Fortune as one of the '100 Best Companies to Work For.' Yet allegations by former employees and customers bear a disturbing resemblance to the reckless, often illegal lending that marked the years leading up the housing crash. Quicken founder and chairman Dan Gilbert, owner of the NBA's Cleveland Cavaliers, has sought to distance his company from the actions of notorious predatory lenders such as Ameriquest and Countrywide. A federal lawsuit starting in Detroit today and other legal action against the nation's largest online mortgage lender paint a decidedly less flattering picture of Quicken, reports Michael Hudson, a staff writer with the Center for Public Integrity.

Quicken Loans' lending practices may not be as exemplary as the company contends.

Money manager ex convers from quicken problems