Ameriquest Mortgage: A Rise and Fall Story

Ameriquest Mortgage was a major player in the subprime mortgage market, but its rise to success was short-lived. The company was founded in 1998 by Roland Michel, a well-known mortgage executive.

Ameriquest's aggressive expansion strategy involved hiring thousands of mortgage brokers and originating hundreds of billions of dollars in subprime loans. The company's business model was built on high-risk, high-reward loans that often had hidden fees and adjustable interest rates.

This approach allowed Ameriquest to quickly grow into one of the largest subprime lenders in the country, but it also made the company vulnerable to market fluctuations. As the housing market began to decline, Ameriquest's business model started to unravel.

The company's collapse was swift and devastating, with Ameriquest filing for bankruptcy in 2007 and shutting down its operations.

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Ameriquest Mortgage was founded in 1979 by Roland Arnall as Long Beach Savings & Loan in Orange County, California.

The company was initially a thrift, but it was converted to a pure mortgage lender in 1994 and renamed Long Beach Mortgage Co. after moving to Long Beach, California.

In 1997, the loan funding department was spun off into a publicly traded company that was later purchased by Washington Mutual in 1999.

Ameriquest was reorganized into three divisions under the private conglomerate ACC Capital Holdings, which was owned entirely by Arnall: Ameriquest Mortgage Company, Argent Mortgage, and AMC Mortgage Services.

In 2004, Ameriquest originated an estimated $50 billion in new subprime mortgages.

On September 1, 2007, Citigroup completed its acquisition of Argent Mortgage and AMC Mortgage Services, effectively shutting down Ameriquest Mortgage.

Ameriquest was founded in 1979 by Roland Arnall in Orange County, California, as a savings and loan association called Long Beach Savings & Loan.

This marked the beginning of a long journey that would eventually lead to the company's growth and transformation.

Roland Arnall moved Long Beach Savings & Loan to Long Beach, California in 1994, where it was converted into a pure mortgage lender and renamed Long Beach Mortgage Co.

The company's early years laid the groundwork for its future success.

In 1997, the department that funded loans made by independent brokers was spun off into a publicly traded company that was later purchased by Washington Mutual in 1999.

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Ameriquest Mortgage's early success can be attributed to its innovative approach to subprime lending.

The company's founder, Roland Arnall, had a vision to provide mortgage financing to borrowers who were often overlooked by traditional lenders.

Ameriquest's focus on subprime lending helped the company expand rapidly, with over 1,000 employees by the end of 2000.

By 2001, Ameriquest was originating over $20 billion in mortgage loans annually, making it one of the largest subprime lenders in the country.

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Ameriquest Mortgage has been involved in several controversies and issues throughout its history. The company was accused of predatory lending practices against older, female, and minority borrowers in 1996, and was forced to pay $3 million into an educational fund as part of a settlement.

Ameriquest was also investigated by the Federal Trade Commission in 2001, and subsequently agreed to offer $360 million in low-cost loans. This was not the only time the company was accused of misleading borrowers, as it was also alleged to have deceived borrowers about the terms of their loans, forged documents, and falsified appraisals.

In 2005, Ameriquest announced that it would set aside $325 million to settle investigations by 30 state attorneys general into allegations that it had preyed on borrowers by offering loans with hidden fees and balloon payments. The company had already settled multimillion-dollar suits in at least five states, including California, Connecticut, Georgia, Massachusetts, and Florida.

Here is a list of some of the notable settlements and fines paid by Ameriquest:

Ameriquest, a mortgage lender, was accused of predatory lending practices in the 1990s. The company agreed to pay $3 million into an educational fund to settle a lawsuit.

In 2001, Ameriquest settled a dispute with ACORN, a national organization of community groups, promising to offer $360 million in low-cost loans. This was a result of an investigation by the Federal Trade Commission.

Reporters Michael Hudson and E. Scott Reckard broke a story in 2005 about "boiler room" sales tactics at Ameriquest. They found evidence of deceptive practices, including forging documents and falsifying appraisals.

Ameriquest announced in 2005 that it would set aside $325 million to settle investigations by 30 state attorneys general. This was in response to allegations of hidden fees and balloon payments.

Here are some key dates related to Ameriquest's predatory lending allegations:

Subprime job cuts have been a major issue in the industry. The parent company of Ameriquest Mortgage Co., ACC Capital Holdings Corp., has cut 3,000 jobs as part of a cost-savings move.

The company cited the "very challenging non-prime market" for the cuts. This is not the first time ACC has made significant job cuts, as they laid off 3,800 employees last May.

Prior to the latest cuts, Ameriquest operated four retail call centers nationwide. Those operations were being consolidated to Southern California, resulting in job losses.

The company has also consolidated wholesale loan production centers in New York into their facilities in Rolling Meadows, Illinois. This move is part of a larger effort to strengthen their financial position and increase efficiency.

ACC has faced controversy in the past, agreeing to pay $325 million in a multistate settlement over claims of deceptive lending practices.

The Connecticut Department of Banking played a crucial role in regulating Ameriquest Mortgage's activities in the state.

In 2005, Ameriquest Mortgage was fined $1.7 million by the Connecticut Department of Banking for violating state laws and regulations.

The company was accused of making predatory loans and engaging in deceptive practices, which led to the fine and a settlement.

Ameriquest Mortgage was required to pay back $1.7 million to the state and to reform its lending practices.

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Ameriquest Mortgage's financial influence extended beyond its business dealings, as the company and its subsidiaries made significant political donations.

In 2005, Ameriquest Capital and its subsidiaries contributed the maximum of $250,000 each to the second inauguration of President George W. Bush, totaling $1 million.

This was a notable change of heart for Roland Arnall, who previously supported the Democratic Party and even officiated his wedding to Dawn Arnall by Democratic California Governor Gray Davis.

Ameriquest's financial influence also extended to local politics, with Roland Arnall being an ardent supporter and fundraiser for Los Angeles Mayor Democrat Antonio Villaraigosa.

The company's political donations were seen as a way to gain favor with the Bush administration, particularly in regards to its middle east policies post 9/11.