Countrywide, Vermont reach agreement
MONTPELIER, Vt. (Legal Newsline) - Vermont Attorney General William Sorrell has announced a settlement with Countrywide Financial Corporation, now a part of Bank of America, to resolve claims by the state concerning the company's origination of home loans in past years.
As a result of the settlement, Countrywide will pay approximately $100,000 to Vermont for foreclosure relief. Half of that amount will go to specific borrowers who saw their Countrywide loans foreclosed upon with the remainder going to general foreclosure relief efforts.
Sorrell alleged that Countrywide had engaged in unfair lending practices in its marketing of some of its home loans without taking into account the ability of borrowers to pay.
Countrywide's settlement with Vermont is similar to those entered into by other states, including those that had alleged that Countrywide had engaged in predatory lending practices.
A total of 43 states and the District of Columbia have entered a $3 billion nationwide agreement with Countrywide over its home loan originations.
The settlement comes as part of an effort by Countrywide to affirm its commitment to offering loan modifications-reductions in interest rates, including, under certain circumstances, to Vermont residents with subprime "hybrid" adjustable rate mortgages, other subprime first mortgages and "pay option" adjustable rate mortgages. All three of these loan types have been associated with the current national mortgage foreclosure crisis.