Beazer will refund $2.5M to NC homeowners
Beazer Homes has agreed to refund $2.5 million to North Carolina homeowners. WFAE's Julie Rose reports: Beazer Homes was one of the largest home builders in the Charlotte area until it pulled out of the market last year amid federal and state investigations. The company today announced a settlement in one of those investigations with the North Carolina Commissioner of Banks. Beazer will make refunds averaging $1,500 to about 1,600 homeowners. However, Deputy Commissioner of Banks Mark Pearce says the home builder did not acknowledge any wrongdoing in the settlement. "We believe that in most of the Beazer mortgages over the last several years, that the amounts being paid up front by borrowers were not in fact going to reduce the rate," says Pearce. Instead, Pearce says the state believes "discount points" Beazer charged borrowers were used to pay other costs in originating the loan, which is against North Carolina law. Pearce says refund checks will automatically be sent to most people who got a mortgage from Beazer in the last five years. Beazer's mortgage practices are also the subject of an ongoing investigation by the U.S. Attorney in Charlotte, as Beazer CEO Ian McCarthy warned investors in a recent earnings report. "Our negotiations with the U.S. Attorney are continuing, and we believe that future additional payments are reasonably possible," said McCarthy. Beazer has budgeted $13 million to cover likely litigation payments over the next two years. McCarthy says total liability from the lawsuits could reach $50 million over the next five years.