Massachusetts Officials Hail Departure of Mortgage Lender

One of the most aggressive bad credit mortgage companies making home loans in Massachusetts has announced it is officially quitting the business.

Good riddance, say Massachusetts housing market officials.

“We don’t need companies like Fremont General,” said Thomas Callahan of the Massachusetts Affordable Housing Alliance, upon word that Fremont General Corp. would be selling off its subprime lending portfolio.

The California mortgage company announced yesterday that it’s dumping as much as $4 billion of existing bad credit mortgages, part of a plan to stop making home loans to people with bad credit.

Subprime lenders like Fremont offer high-cost, high-interest mortgages to people with poor or suspect credit.

But Bay State activists have long said that Fremont put many Massachusetts home buyers into mortgages so costly and ill-advised that customers often lost their homes to foreclosure at alarming speed.

Officials in Boston say Fremont financed a shocking 10 percent of the 261 homes auctioned off last year for Massachusetts mortgage payments not being made on time.

That trails only Ameriquest Mortgage as the No. 1 Boston home loan source that ended up in foreclosure auctions.

Fremont spokesman Dan Hilley declined to comment.

Equally happy was Robert Pulster of Jamaica Plain’s Ensuring Stability through Action in Our Communities (ESAC) charged that the company “caused a great deal of pain and suffering in (Boston).”

ESAC, which helps homeowners avoid foreclosure, estimates Fremont wrote about 40 percent of the problem mortgages the group deals with.

SOURCE: Boston Herald