Alabama State Banking Department revokes Hometown Lenders’ consumer credit license, pointing to multiple violations
HUNTSVILLE, Ala. (WAFF) - Following a months-long investigation by the Alabama State Banking Department, Hometown Lenders has officially had its Consumer Credit License revoked.
It comes on the heels of yet another lawsuit alleging the company defaulted on loan payments, owing more than $21 million dollars to a Michigan-based banking company.
An explosive court document from the State Banking Department Bureau of Loans says the company violated multiple laws and regulations while refusing to cooperate with an investigation.
It lays out damning details regarding the mortgage lending company including testimony from former Hometown Lenders employees and its former COO.
Hometown Lenders originates mortgage loans for prospective investors for their projects through Mortgage Insurance Premiums or MIPs.
However, the state discovered Hometown Lenders had collected nearly $500,000 in MIPs, but failed to pay those same MIPs beginning around November 2022 meaning they weren’t disbursing money investors needed to complete their projects. A total estimate of the damage is almost $1.5 million.
A former Hometown Lenders Post Closing Manager testified that the number of unpaid MIPs made her job impossible.
She also went into detail that Hometown Lenders struggled to make payroll and did not pay into its employees 401k plans.
She even testified her healthcare coverage was canceled because the company stopped paying for its portion.
Court documents also shared that in the hearing where all this information was presented, nobody representing Hometown Lenders even attended the hearing.
It also says hat there is enough evidence on the record to indicate that any lesser action other than revoking their license to operate would quote “result in further harm to the citizens of our state and other states.”
Click Here to Subscribe on YouTube: Watch the latest WAFF 48 news, sports & weather videos on our YouTube channel!
Copyright 2023 WAFF. All rights reserved.
