Tuesday, November 30, 2010

Lehman Bros. Sues Lenders That Sold It The Mortgage Loans

LEHMAN BROS., which failed in 2008 while holding bad real estate loans, on Nov. 15, filed suit against NATIONFIRST LENDING INC., an Irvine mortgage company for allegedly misrepresenting the strength of loans it sold to the Wall Street firm. The lawsuit, filed in federal court in Los Angeles, alleges that Nationsfirst Lending Inc. misrepresented the identities of borrowers, the value and condition of property securing the loans and the validity of loan documents. NATIONSFIRST is listed as a suspended corporation on the California Secretary of State website.


The company sold Lehman an unspecified number of loans from 2004 to 2007, the lawsuit said. Lehman alleges that straw buyers, who never intended to occupy the homes, were used in two of the Nationsfirst loans and that a loan officer received a kickback for making the loans.

THE LAWSUIT AGAINST NATIONSFIRST IS ONE OF SEVERAL SUITS that Lehman has filed against mortgage companies alleging that they misstated the strength of loans and creditworthiness of borrowers. It has FILED LAWSUITS AGAINST CALIFORNIA FINANCIAL GROUP INC. OF PORT ORCHARD, WASH.; FIRST GUARANTY FINANCIAL CORP. OF SANTA ANA; COLONY MORTGAGE LENDERS INC. OF GLENDALE; and other lenders.

Source: Californiaforeclosurefraud

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