H&R lender settles with Mass. over loans

BOSTON – The H&R Block mortgage lender formerly known as Option One Mortgage reached a $125 million settlement with the state of a lawsuit over allegedly risky loans, the state said.
Bloomberg News reported said that the unit, Sand Canyon Corp., agreed to pay $9.8 million to Massachusetts and will direct American Home Mortgage Servicing Inc., which services Option One loans in the state, to establish a loan-modification program for struggling borrowers, state Attorney General Martha Coakley said last week in a statement.
Option One was sued by Massachusetts in 2008 and accused of making risky loans that were doomed to fail and discriminating against black and Latino borrowers by charging more for their loans, Coakley said.
The settlement will provide an estimated $115 million in loan modifications to homeowners, Coakley spokeswoman Melissa Karpinsky said. •