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Paramount in Trouble w/ Washington State

Interesting turn of events. People who live on the west coast have probably heard the Hayes Barnard commercials...not going to say anything bad and just let the article do the talking.

State goes after Paramount Equity Mortgage

The state wants to revoke the license of Paramount Equity Mortgage Inc. and fine the company $500,000 over deceptive lending practices.

The state Department of Financial Institutions charged the company with collecting unearned fees, hiding fees from borrowers, charging consumers to buy down interest rates without reducing the rate and not making certain fee disclosures.

Paramount, based in Roseville, Calif., has a branch office in Bellevue and issued more than 1,700 mortgages to Washington borrowers in 2007 and collected more than $8.7 million in fees, according to DFI.

The company peppered local radio stations with commercials featuring Paramount's president, Hayes Barnard, touting low rates. The state says those ads were deceptive, according to its statement of charges (12 pp, PDF). The company advertised that it was a "mortgage bank" when it wasn't, and advertised that it guarantees the lowest or best rates when it couldn't be substantiated, said Deb Bortner, DFI's director of consumer services.

"Paramount failed to make proper disclosures in almost every loan we reviewed," she added.

Messages left at the Bellevue and Roseville offices were not immediately returned.

If you feel you were harmed by the company's actions, file a complaint with DFI online or call 360-902-8811.

Posted by Spokane Home Loan -- Casey Brischle -- Mortgage Professional on 07/23/2008 01:15 PM

Comments (7)

mortgage, mortgage fraud, washington state mortgage

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7 Comments on Paramount in Trouble w/ Washington State

Casey, I guess I don't watch enough TV because I've never heard of these guys. It always kills me when a state agency goes after a company for fines....let's see, they want to impose a $500,000 fine against fees collected of $8.7 mil in fees collected. That's not a bad investment for Paramount! If they get a good attorney I'll bet they could reduce the fine by 50% and keep their license.

$8.7mil in fees collected?? It must have been a great commercial!

07/23/2008 04:27 PM

by Michael Mullin ~ Spokane WA Home Loans | ~ Lake Spokane ~ Suncrest (First Priority Financial)

Wow! They're still going to be in business? Michael's right, it isn't a bad investment and the fine probably will get reduced. At least you're getting this out there to protect others.

07/23/2008 05:01 PM

by Mark Organek - Tempe Gilbert Mesa Chandler REALTOR (RE/MAX Alliance)

I have a great mortgage through them and when I did my loan the fees were less than Bank of America, so Bank of America must be even worse which is much scarier!!!!

07/24/2008 08:18 PM

Michael - you have probably heard them on the radio. They say they are a Spokane or Washington State company, but in all actuality they are based out of Roseville California. Spokane callers actually get routed to a loan officer in California leaving no way to meet face to face.

Long time no chat Mark. Thanks for stopping by. Hope all is well.

Anonymous - GLAD TO HEAR IT! With any company there are ethical loan officers and unethical ones. I am glad to see you got a good one and are happy! I ahppen to knwo a few people at the company that are great. I hope things work out for them.

07/25/2008 10:59 AM

by Spokane Home Loan -- Casey Brischle -- Mortgage Professional (Bank of Whitman)

Casey, deceptive lending and practices of "hiding" fees have been going on for years. What hurts is when a lender like me puts a GFE in front of a customer I get asked where the hidden fees are.

07/28/2008 05:56 PM

by Danny Thornton (Home America Mortgage, INC.)

Danny - Exactly. It is a shame that our industry is looked upon like that. Paramount had $1700 in fixed fee's, BEFORE the Origination or Broker Fee. They are feeling the heat.

07/28/2008 06:00 PM

by Spokane Home Loan -- Casey Brischle -- Mortgage Professional (Bank of Whitman)

Because of Washington's actions against Paramount, now the State of Oregon is also looking closer at them and maybe following suit again Paramount, certainly not looking good for this lender.