by Joe Bird
[Ed. note: Our new Michigan based team led by Joe Bird is getting an inside look at the belly of the beast that is the mortgage industry.]
It seems that mortgage lenders can be cannibals as well as pirates. Allied Home Mortgage is accused of routinely forcing its branch managers to pay the operating expenses of its local offices in violation of federal lending laws designed to protect the consumer. When investigated by the U.S. Department of Housing and Urban Development (HUD), Allied agreed to make sure all branch manager employment contracts were writen so that Allied paid the operating expenses as required by HUD.
Apparently the HUD investigation was not taken very seriously. Even after changing the standard contracts in 2002, Allied continued to deduct all the operating expenses from the branch managers commissions.
We are in the midst of an arbitration proceeding where this conduct is now being exposed and the now bankrupt branch manager of closed Allied office may have a chance to recover millions of dollars owed to him.
Frequently we read horror stories of mortgage fraud and foreclosure abuse. Many lenders do not have a great track record in the way they treat borrowers. The terms “predatory lending” and “robosigner” were not even part of our vocabulary until the mortgage crisis began a few years ago. It is not surprising then, that a few unscrupulous lenders might try to siphon funds from their own employees.
Published reports suggest that Allied is one of the worst. According to a USAToday article, the company has been sued by borrowers, has underpaid employees and been the target of many investigations including the U.S. Secret Service.
If you were on of the nearly 2,300 branch managers employed by Allied and think you might have been defrauded, there might still be hope for you. Contact us today.