CHARLOTTESVILLE, Va. – SunTrust Mortgage Inc. has agreed to pay up to $320 million to resolve allegations that it misled customers seeking loan modifications.
The company and U.S. Attorney Timothy Heaphy announced the settlement Thursday.
Settlement documents say SunTrust misrepresented or omitted information to borrowers participating in the federal Home Affordable Modification Program and failed to process applications in a timely manner. The company is making up to $274 million available for restitution to customers who suffered financial harm. Additional funds will go to Fannie Mae and Fannie Mac, to law enforcement agencies working on mortgage fraud and to mortgage counselling agencies.
SunTrust Mortgage CEO Jerome Lienhard said in a news release that the company recognizes there were deficiencies in its administration of the program and is focused on the future.