Quicken Loans HQ Underwriting Lawsuit – Detroit
Luke Osborne November 14, 2016
And so the finger pointing begins.
Underwriter: “They made me underwrite loans I didn’t feel comfortable and gave me big bonus to do so.”
Quicken Loans: “We did no such thing! It is the individual underwriters that need to be held accountable, not us!”
So who is to fault? Probably both of them. But we will see how things pan out.
Regardless of who is to fault, there will be a change of venue in the trial of USA v. Quicken Loans case—from Washington, D.C. to the U.S. District Court for the Eastern Michigan District, which is based in Quicken’s headquarter city of Detroit.
In its lawsuit, the government allege Quicken knowingly submitted claims for hundreds of improperly underwritten FHA-insured loans. These loans involved inflated appraisals, poor credit risks and borrowers with insufficient incomes. Quicken also failed its obligation to disclose problems with the loans to the FHA, the suit said.
The government further alleges Quicken gave “speed bonuses” to underwriters and encouraged a culture of bending the rules to encourage loan approvals. The suit claims taxpayers lost millions of dollars when the loans went bad.