MADISON, Wisc. (Legal Newsline) - More than 40 state attorneys general across the country will be distributing refunds to thousands of effected homeowners as part of a nationwide settlement with Countrywide Financial Corporation.
The refund checks come after a settlement was reached resolving allegations that the company used unfair and deceptive tactics in its loan-origination and servicing activities, and that borrowers were allegedly put in unfair and unaffordable loans.
Wisconsin Attorney General J.B. Van Hollen said Bank of America, which owns Countrywide, has allocated up to $150 million nationally to provide relief for borrowers who experienced foreclosure.
"I am pleased that this settlement and restitution may offer eligible borrowers and their families some relief," Van Hollen said.
Eligible consumers will receive written notice from their respective state attorney general, along with a claim form and other related information from Countrywide, he said.
Pennsylvania will distribute refunds to around 1,151 residents, with each of those consumers eligible for a minimum payment of $2,388, according to attorney general Tom Corbett.
Montana Attorney General Steve Bullock said residents of the state who lost their homes due to foreclosure are eligible for a settlement of around $2,000 each.
"Before the housing bubble burst, lenders like Countrywide talked a lot of consumers into loans they had little hope of ever paying back," Bullock said.
"While $2,000 can't make up for losing your home, I'm hopeful that it will help the people involved through a tough financial time."
Refund checks will be issued beginning in the first quarter of 2010.