A Washington-area mortgage company that reneged on loan rates it allegedly promised consumers has agreed to honor its earlier commitments and to reimburse home buyers and sellers for any added expenses they incurred.

Maryland Attorney General Stephen H. Sachs announced the agreement Wednesday with the Pioneer Mortgage Co. of Springfield, Va. The firm changed its settlement charges last month -- raising the number of points paid by sellers -- after two federal mortgage insurance agencies raised rather than lowered interest rate ceilings.

Pioneer is one of 14 mortgage firms that allegedly refused to live up to oral or written loan commitments after the cost of obtaining money unexpectedly rose. Sachs said the state had received more than 100 consumer complaints concerning the practice.

Pioneer said that while it broke no laws, it nonetheless agreed to make good any losses suffered by customers.

The agreement with Pioneer is "the first across the board with mortgage bankers involved in this problem," Sachs said. "This means that consumers who had to obtain a mortgage from another lender will be fully reimbursed, even if they had to pay a higher interest rate, more points or other fees."

Irvin Liptz, Pioneer's attorney, said the problem had occured only in its Maryland branches, located in Pikesville, Annapolis and Forestville. "It's really a blight on the industry," he said. "We hope we can clean up this entire situation. We feel good about what we've done and we hope other mortgage companies will follow our lead."

If they don't, Sachs said, the state is prepared to seek civil damages. "We have notified at least three others that unless they negotiate agreements very shortly, we're going to court," said Jay Lenrow, assistant attorney general for consumer protection.

Lenrow said his office received 15 complaints about Pioneer. Liptz said that about 40 transactions occured during the period from Aug. 20 to Sept. 20, when Pioneer agreed to change its policies.

All transactions involved federally insured loans, under which interest rates charged the buyer are regulated. The current rate is 13 percent. Mortgage companies obtain the funds they loan by selling packages of loans to investors, a volatile market in recent months.