NY ATTORNEY GENERAL SCHNEIDERMAN AND CALIBER HOME LOANS | Lone Star Funds building a new Countrywide Financial? | FANNIE MAE AND FREDDIE MAC AND OH MY GOD

Eric T. Schneiderman, New York State’s attorney general, is investigating Caliber Home Loans, a mortgage lender owned by Lone Star Funds. Caliber Home has grown fast but also has drawn many complaints. Credit John Minchillo/Associated Press 

 

By MATTHEW GOLDSTEIN and RACHEL ABRAMSOCT. 6, 2015

http://www.nytimes.com/2015/10/07/business/dealbook/new-york-attorney-general-examining-private-equity-firms-mortgage-business.html?_r=0

The rapid growth of Caliber Home Loans, a mortgage company owned by the private equity giant Lone Star Funds, has led to a surge in consumer complaints. Now it has led to regulatory scrutiny of Caliber’s business practices.  Eric T. Schneiderman, the New York attorney general, has opened an investigation into the mortgage company, a person in Mr. Schneiderman’s office confirmed.

Caliber’s massive growth has been fueled in part by Lone Star Funds’ acquisitions of nonperforming loans from government-supported entities like HUD, Fannie Mae and Freddie Mac.
However, Lone Star Funds’ decision to tap former executives of disgraced lender Countrywide Financial raises questions about the firm’s ability to manage its explosive growth. The New York Times recently called Lone Star a “lightning rod, criticized by housing advocates and lawyers for borrowers.”  http://www.businesswire.com/news/home/20150929005648/en/UNITE-Lone-Star-Funds-building-Countrywide-Financial