CO Attorney General Obtains Settlement Over Home Equity Agreements

Colorado Attorney General Phil Weiser announced that a company has entered into an assurance of discontinuance regarding its home equity agreements. 

The attorney general’s office alleged that the agreements, which provided homeowners with lump sum payments in exchange for a percentage interest in the future value of their homes, constituted consumer credit transactions under Colorado law.

While the company disputed the allegations, it desired to avoid the inconvenience and expense of disputing the matter and, therefore, reached a resolution without admitting liability or wrongdoing.  Under the assurance of discontinuance, the company agreed to comply with the Colorado UCCC, including the state’s Consumer Equity Protection Act, and the accompanying interest rate caps, required disclosures, and licensing requirements.

The company also agreed to pay $390,783 in restitution to 167 affected homeowners (with additional payments expected as more agreements close) and $37,500 to the attorney general’s office.