FreedomWide- DEBT CONSOLIDATION, LOWER MONTHLY PAYMENTS, CONSOLIDATE DEBT

American Interbanc Mortgage LLC has agreed to accept slightly more than $2 million to end its bid to force a unit of NovaStar Financial Inc. into involuntary bankruptcy.

American Interbanc filed an involuntary bankruptcy petition against NovaStar Home Mortgage in January in an attempt to collect a judgment against the unit. A California court ruled in June that NovaStar Home Mortgage had engaged in false advertising and unfair competition, and rendered a $46.1 million judgment against it, which with interest grew to $48.9 million as of late January.

In a filing Thursday with the Securities and Exchange Commission, Kansas City-based subprime mortgage lender NovaStar Financial (Pink Sheets: NOVS) said that the settlement agreement, entered into Monday, requires it to pay American Interbanc $2 million plus the balance in an account established by the U.S. Bankruptcy Court for the Western District of Missouri.

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Tags: lender news, novastar

This entry was posted on Friday, March 21st, 2008 at 7:05 pm and is filed under Mortgage Lender & Broker News. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.