Industry News

Real estate loan victims get $65 million

More First Alliance settlement checks in mail

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Nearly 20,000 borrowers will receive a second compensation check this week from a fund that resulted from the FTC's settlement with home mortgage lender First Alliance Mortgage Co. and its CEO. Borrowers who obtained home mortgage loans through First Alliance previously received compensation for the loan origination fees the company charged them in a round of checks mailed in December 2002. The additional money comes as the parties continue to implement a settlement agreement. According to the settlement, the initial pool of almost $45 million was slated to more money as First Alliance was liquidated in bankruptcy. The additional funds bring total consumer redress to $65 million. First Alliance, headquartered in Irvine, Calif., formerly offered home loans, usually secured by first mortgages, in 18 states and Washington, D.C. The company marketed its loans to the subprime market, which includes borrowers with poor credit ratings who couldn't qualify for conventional financing. Bria...