Industry NewsMortgage

WaMu paid agents referral fees

Report: office had $1 billion in loans in 2004

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A Washington Mutual retail mortgage office in Southern California turned real estate agents into "a pipeline for loan applications" by paying them referral fees, according to a New York Times story detailing the lender's rapid expansion during the housing boom. Fearing they could be construed as illegal kickbacks, WaMu banned referral fees in 2006 but allowed a team of 20 loan agents at the company's Downey branch to continue offering them, the Times reported. The fees attracted real estate agents from all over Southern California, an anonymous former WaMu loan agent told the Times. JPMorgan Chase, which bought WaMu in September for $1.9 billion, would not comment on the company's operations before the acquisition.The Times said the story was based on interviews with two dozen former WaMu employees, mortgage brokers, real estate agents and appraisers in California, Florida, Illinois and Texas.WaMu expanded its home lending with the purchase of subprime lender Long Beach Finan...