American Home Mortgage Servicing Inc. of Coppell, Texas, faces charges by Texas investigators of using unlawful and aggressive collection tactics and improperly misleading homeowners, according to Attorney General Greg Abbott's office.

An investigation revealed American Home collectors also failed to credit homeowners who properly submitted their payments on time, and often falsely claimed that homeowners did not make payments so the company could justify profitable late fees or escrow accounts.

The company also did not always properly credit homeowners after collectors withdrew funds from the homeowners' checking accounts. Because of the defendant's illegal conduct, homeowners defaulted on their loans, leading to foreclosure proceedings, according to the Attorney General's Office.

The charges were announced Monday.

American Home further claimed to have a "Home Retention Team" to help struggling homeowners. Many customers found that American Home could not qualify homeowners and that they were of no help to halt the foreclosure process, the Attorney General's office said. Some homeowners who obtained loan modifications found their monthly payments increased rather than decreased, the state alleged.

The state is seeking civil penalties of up to $20,000 per violation of Texas law.

Officials at American Home, which is owned by the billionaire Wilbur Ross' WL Ross & Co., could not be reached for comment.

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