A Federal grand jury has accused a defunct Virginia mortgage company, a Maryland title company and seven other individuals of misrepresenting loan terms to borrowers as part of a conspiracy that involved more than $10 million in loans.

As a result of the loan terms -- which allegedly were arranged by Nationwide Mortgage Corp., formerly of Alexandria -- many families lost their homes, which were collateral, according to a Justice Department attorney involved in the case.

The department announced yesterday that a grand jury in the District returned a 17-count indictment last week against Nationwide; The indictment says the average annual rate of interest charged to the borrowers was at least 45 percent. its former president, Norman C. Tillette, and others, charging the defendants with conspiracy and interstate transportation for the purposes of fraud. Most of the counts carry a maximum penalty of $10,000 and/or 10 years imprisonment, the department said.

E. Leslie Hoffman, an attorney with the Justice Department, said the indictments resulted from a larger investigation that he and other attorneys are conducting into deception by area mortgage companies. He declined to identify other firms under investigation.

The indictment returned last week is the latest in a series of legal actions brought by government agencies and private parties against Nationwide and its associates. Numerous civil lawsuits have been initiated against the company, which no longer is operating, and the Federal Trade Commission filed a complaint in federal court in the District last March that also accused the firm of misrepresentation. The company is not related to Nationwide Lending Group Inc. of Rockville or Nationwide Lending Co. of McLean.

Tillette, Nationwide's former president, could not be reached for comment. Donald Lamb, an attorney who other lawyers in the case said is representing Tillette, refused to comment on the federal indictment. C. Jimmie Vaccaro Jr., president of Southeast Title Corp., another defendant, also refused comment, and other defendants could not be reached.

The defendants are scheduled to be arraigned in U.S. District Court here on Thursday, Justice Department attorneys said.

According to the indictment returned last week, the defendants engaged in an elaborate loan arrangment in which the average annual rate of interest charged to the borrowers was at least 45 percent. Nationwide didn't finance the loans, but obtained the money through private investors and an unnamed savings and loan, according to Hoffman.

The indictment charges that the company and its agents promised prospective borrowers easily available financing. Each loan required interest-only payments each month and a payment for the whole face value of the loan at the end of a year. According to the indictment, however, excessive fees and discounts -- totalling about 20 percent of the total loans made between 1980 and 1983 -- were deducted such that the actual amount of the loan proceeds for borrowers was far less.

In addition, the prospective borrowers allegedly were promised long-term financing for the loans soon after the deals were closed, but this financing never was provided, the indictment said.

Although the loans were to be used for consumer financing, customers of Nationwide were told to state that they would use the funds for "business purposes." The indictment said this was to deprive the borrowers of certain rights secured by the Truth in Lending Act and District of Columbia usury laws.

Hoffman said that more than 300 borrowers went to Nationwide for loans of between $5,000 and $50,000.