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