RICHMOND, Va. - SunTrust Mortgage Inc. has agreed to pay $21 million to settle a federal lawsuit alleging racial discrimination in its lending practices.

The consent order was filed Thursday in U.S. District Court in Richmond, where the company has its headquarters. SunTrust Mortgage is a subsidiary of the nation's 11th-largest commercial bank.

The order says SunTrust Mortgage denies wrongdoing but agreed to the settlement to avoid costly litigation.

The U.S. Justice Department's complaint alleged that black and Hispanic borrowers were charged more for loans. The department says it reviewed more than 850,000 residential mortgage loans originated by the company between 2005 and 2009.

The settlement requires the lender to continue using policies it later adopted to prevent discrimination.

The agreement is subject to court approval.