Indiana reaches $2.8M settlement with Countrywide

Posted on May 16, 2009. Filed under: Mortgage Fraud, Mortgage Law, Predatory Lending | Tags: , , , , , , , |

Indianapolis – Some relief is on the way for a small number of Hoosiers who were cheated out of their money. As much as $2.8 million will be returned to Indiana homeowners because of one company’s predatory practices.

Indiana State Attorney General Greg Zoeller announced a $2.8 million predatory lending settlement against Countrywide on Tuesday. About 1,700 Hoosiers will split the settlement.

Zoeller said individual payouts “will be based on the number of people who respond.”

The biggest immediate problem will be finding those Hoosiers who already lost their homes. An independent consultant will be hired to find those Hoosiers who qualify.

“We are going to aggressively try to find people who are eligible…every effort will be made to find as many of the 1,700 as possible,” Zoeller said.

The settlement was made somewhat easier by negotiating with Bank of America which now owns Countrywide. The overall amount of the settlement is more punishment for truth in lending infractions than actual rescue for those who lost their homes.

“They had a low rate to attract people in. They were not fully explained to the consumer so when it reset in the second year they were completely under water, unable to manage the mortgage payments,” said Zoeller.

A portion of that settlement, $50,000, will go to the Indiana Foreclosure Network. Lt. Governor Becky Skillman accepted the donation.

via Indiana reaches $2.8M settlement with Countrywide – WTHR | Indianapolis.

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