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Fairbanks Trying to Settle Abusive Loan Practices Charges

Fairbanks Capital • Complaints News • Fairbanks To Refund $40 Million To Consumers • Company May Settle Charges for $55 Million

October 24, 2003
Fairbanks Capital Corp., accused of bilking homeowners nationwide, is trying to negotiate a multi-million-dollar settlement with the Federal Trade Commission (FTC) and the U.S. Department of Housing and Urban Development (HUD).

Fairbanks' parent company, PMI Group Inc., said the settlement of regulatory actions and consumer class action lawsuits was likely to total $55 million. The FTC and HUD both declined to confirm that a settlement had been reached.

Fairbanks is a loan servicing company which collects monthly mortgage payments, mostly from homeowners with subprime credit ratings. Consumers and regulators have charged that the company routinely uses abusive and deceptive tactics, posts payments late and imposes unnecessary fees.

"I am in serious danger of losing my home, that my husband built, in which we have resided for the past 41 years" because of Fairbanks' practices, said Zora of Franklinville NJ in a complaint to ConsumerAffairs.com.

Fairbanks has agreed to clean up its business practices and create a $40 million fund to reimburse consumers harmed by the company's actions, PMI said.

Fairbanks ousted three executives, including the CEO, last spring as part of its effort to clean up problems at the comany.

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