Borrowing Trouble

By Gretchen Morgenson and Julie Creswell
The New York Times

When Gregory and Paula Sherman wanted to refinance the mortgage on their ranch-style home in Chattaroy, Wash., near Spokane, in June 2003, they went to a local mortgage broker.

The broker got them a $267,200, 30-year loan at an 8.5 percent fixed rate with NovaStar Financial.

Or so they thought.

..The Shermans’ lawyer, Ari Y. Brown of Bergman & Frockt in Seattle, said an examination of hundreds of NovaStar loans showed the company was still not providing accurate information in good-faith estimates. Mr. Brown said at least 1,000 NovaStar customers in Washington State could be members of the class