Maryland alleges that Countrywide Financial Corporation engaged in unfair and deceptive business practices that placed consumers in risky, high-priced, and ultimately unaffordable mortgage loans
BALTIMORE (January 29, 2009)—Attorney General Douglas F. Gansler on Tuesday announced that his Consumer Protection Division has filed with the Circuit Court for Baltimore City a Consent Judgment with Countrywide Financial Corporation (“Countrywide”) that resolves an investigation into the company’s loan origination practices. Under the Consent Judgment and Permanent Injunction, Countrywide will, consistent with a program previously announced by Countrywide’s new owner Bank of America, offer loan modifications and relocation assistance to certain borrowers who are unable to retain their homes. Countrywide will also pay more than $2.1 million to Maryland borrowers as a part of a foreclosure relief program.
The Complaint alleges that Countrywide engaged in unfair and deceptive business practices that placed consumers in risky, high-priced, and ultimately unaffordable mortgage loans. According to the Complaint, Countrywide enticed consumers with low teaser rates, low monthly payments and “no closing cost” loans that failed to adequately disclose the loans’ costs or risks. The Division’s investigation and the allegations contained in the Complaint involved loan origination practices that allegedly were employed prior to Countrywide’s purchase by Bank of America. Countrywide denied having engaged in any illegal practices.
“Today’s announcement means eligible homeowners in Maryland will be able to stay in their homes,” said Attorney General Gansler. He encouraged Marylanders who are having trouble meeting their mortgage payments or facing foreclosure to call 1-877-462-7555 or to visit www.mdhope.org.
The loan modification program contained in the Consent Order is consistent with the nationwide loan modification program announced by Bank of America in October. The qualifying mortgages consist of subprime hybrid adjustable rate mortgages, pay option adjustable rate mortgages, and other subprime mortgages.
Homeowners eligible for loan modifications will be notified by Countrywide. Marylanders eligible for foreclosure relief will also be notified.
Source: Maryland Attorney General Douglas F. Gansler