HARRISBURG, PA-Taylor, Bean & Whitaker Mortgage Corp. will modify loans for struggling homeowners and pay $9 million in fines as part of a settlement with the Pennsylvania Banking Department and 13 state mortgage regulators.
The agreement comes as the result of a multistate examination of nontraditional mortgages originated by TBW in 2006. The review uncovered numerous instances in which applicants' incomes and assets were altered in order to gain loan approvals, said Pennsylvania secretary of banking Steve Kaplan. Alleged practices included the multiple submissions of loan applications by third-party originators through automated underwriting programs resulting in altered income and asset information for prospective borrowers in order to qualify applicants for mortgages. "Concern over these practices prompted TBW to stop offering nontraditional mortgages in early 2007 and to make changes to its internal control processes," he said.