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BOSTON – As part of a settlement with H&R Block subsidiary Sand Canyon Corp., which formerly operated as Option One Mortgage Corp., Massachusetts has distributed close to $5 million to borrowers affected by the company’s alleged predatory lending practices, Attorney General Martha Coakley announced last week.
More than 500 affected borrowers throughout the state who received loans from Option One between 2004 and 2007 have been sent checks ranging from $5,000 to $25,000.
Additionally, the settlement provides relief for borrowers who still have an Option One loan with an aggressive loan-modification program that gives significant writedowns of principal balances and reduction of interest rates, depending on the presence of certain risk features in the loan. To date, 812 borrowers have received loan modifications through the settlement, resulting in an estimated $85.8 million in principal reduction and more than $38 million in monthly payments reduced.
The payments are part of an August 2011 settlement in which Option One agreed to pay $9.8 million to resolve claims of discriminatory and unfair mortgage-lending practices. •