Skip to main content

Mortgage Investors Sue Citigroup Over Home Loan Underwriting Practices

NationalMortgageProfessional.com
Nov 05, 2010

Charles Schwab Corporation, the Federal Home Loan Bank of Chicago, the Federal Home Loan Bank of Indianapolis and Cambridge Place Investment Management have sued Citigroup over its home loan underwriting processes. Citigroup made the claims in a filing with the Securities & Exchange Commission (SEC) on Nov. 5. The suit claims that Citigroup funded sub-prime loans, repurchased and pooled them, and then sliced the pools into securities that could be resold to investors. The lawsuits against Citigroup allege that the bank failed to report important information regarding the securities. Charles Schwab Corporation, the Federal Home Loan Bank of Chicago, the Federal Home Loan Bank of Indianapolis and Cambridge Place Investment Management are seeking their money back and other damages. "The poor performance of the loans in these pools demonstrates that the originators departed extensively from their underwriting guidelines when making these loans," said a spokesperson from Charles Schwab. Hedge fund Cambridge Place is seeking to recoup approximately $1.2 billion it lost on sub-prime mortgages, naming Citigroup and other major banks, including Goldman Sachs, Morgan Stanley and JPMorgan Chase as having sold toxic pools.
Published
Nov 05, 2010
Complex Algorithms Causing Complex Compliance Issues

Complying with Reg B and ECOA on adverse action

Regulation and Compliance
Jan 27, 2023
The State Of Remote Work In Mortgage

Regulations are catching up with remote work, are you prepared?

Regulation and Compliance
Jan 27, 2023
Becoming The Interest Rate Expert

Understand the five main variable components of rate-sheet pricing and interest rates

Regulation and Compliance
Jan 27, 2023
Farm, Land, & Builder Associations Sue Over New U.S. Waters Rule

EPA, Army Corps of Engineers publish rule revision that lawsuit says goes too far.

Regulation and Compliance
Jan 23, 2023
FHFA Updates GSEs’ Single-Family Pricing Framework

New framework takes effect on May 1, but MBA asks agency to be 'flexible' with that date.

Regulation and Compliance
Jan 19, 2023
CFPB Proposes Public Registry Of Nonbank Form Contracts

Says such contracts often have terms & conditions that claim to waive or limit consumer rights.

Regulation and Compliance
Jan 16, 2023