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By Christopher Wills
Associated Press
POSTED: 09:54 a.m. EDT, Oct 06, 2008
SPRINGFIELD, Ill.: Facing a lawsuit over deceptive mortgage practices, Bank of America Corp. is agreeing to pay more than $8 billion to modify hundreds of thousands of loans to keep people in Ohio and other states from losing their homes.
Charlotte, N.C.-based Bank of America said today it will modify troubled mortgages with up to $8.4 billion in interest rate and principal reductions for nearly 400,000 customers of Countrywide Financial Corp., the troubled mortgage lender it acquired last summer.
The announcement arrived after the Illinois attorney general's office said Sunday that the bank was modifying loans for customers in 11 states.
Some borrowers stuck with Countrywide customers might qualify for having to pay nothing but interest for a decade. Even people who can't afford to keep their homes with such changes will be able to get help moving to a new home.
''This is going to provide a tremendous amount of relief,'' said Illinois Attorney General Lisa Madigan.
Her office and officials from California negotiated the settlement; Illinois and California sued Countrywide earlier this year. Nine other states have also joined the settlement, and other states could sign on, said Deborah Hagan, chief of Madigan's Consumer Protection Division.
In California alone, the settlement will offer $3.5 billion in relief. For Illinois, that would translate to $190 million.
''Countrywide's lending practices turned the American dream into a nightmare for tens of thousands of families by putting them into loans they couldn't understand and ultimately couldn't afford,'' California Attorney General Jerry Brown Jr. said in a statement Sunday.
The other states joining the settlement are Arizona, Connecticut, Florida, Iowa, Michigan, North Carolina, Ohio, Texas and Washington.
Bank of America said it will launch the new mortgage aid program in December.
In a statement, Barbara Desoer, president of Bank of America's mortgage, home equity and insurance services, called the plan ''a comprehensive program that provides more solutions than ever before to assist troubled borrowers and put them back on the path to sustained home ownership.''
The mortgage aid includes revising customers' payments so they don't exceed 34 percent of income. Other options include reducing interest rates and adjusting principal so that borrowers don't wind up actually losing equity under some payment plans.
Countrywide will not charge loan modification fees and will waive prepayment penalties.
Madigan said she hopes the settlement could serve as a model for steps that other lenders could take to make up for misleading mortgage practices. She stressed that the agreement involves no tax money but will help people keep their homes and keep money flowing to lenders
''This settlement will help homeowners stay in their homes, which ultimately helps investors and also helps communities,'' said Madigan, a Chicago Democrat.
SPRINGFIELD, Ill.: Facing a lawsuit over deceptive mortgage practices, Bank of America Corp. is agreeing to pay more than $8 billion to modify hundreds of thousands of loans to keep people in Ohio and other states from losing their homes.
Charlotte, N.C.-based Bank of America said today it will modify troubled mortgages with up to $8.4 billion in interest rate and principal reductions for nearly 400,000 customers of Countrywide Financial Corp., the troubled mortgage lender it acquired last summer.
The announcement arrived after the Illinois attorney general's office said Sunday that the bank was modifying loans for customers in 11 states.
Some borrowers stuck with Countrywide customers might qualify for having to pay nothing but interest for a decade. Even people who can't afford to keep their homes with such changes will be able to get help moving to a new home.
''This is going to provide a tremendous amount of relief,'' said Illinois Attorney General Lisa Madigan.
Her office and officials from California negotiated the settlement; Illinois and California sued Countrywide earlier this year. Nine other states have also joined the settlement, and other states could sign on, said Deborah Hagan, chief of Madigan's Consumer Protection Division.
In California alone, the settlement will offer $3.5 billion in relief. For Illinois, that would translate to $190 million.
''Countrywide's lending practices turned the American dream into a nightmare for tens of thousands of families by putting them into loans they couldn't understand and ultimately couldn't afford,'' California Attorney General Jerry Brown Jr. said in a statement Sunday.
The other states joining the settlement are Arizona, Connecticut, Florida, Iowa, Michigan, North Carolina, Ohio, Texas and Washington.
Bank of America said it will launch the new mortgage aid program in December.
In a statement, Barbara Desoer, president of Bank of America's mortgage, home equity and insurance services, called the plan ''a comprehensive program that provides more solutions than ever before to assist troubled borrowers and put them back on the path to sustained home ownership.''
The mortgage aid includes revising customers' payments so they don't exceed 34 percent of income. Other options include reducing interest rates and adjusting principal so that borrowers don't wind up actually losing equity under some payment plans.
Countrywide will not charge loan modification fees and will waive prepayment penalties.
Madigan said she hopes the settlement could serve as a model for steps that other lenders could take to make up for misleading mortgage practices. She stressed that the agreement involves no tax money but will help people keep their homes and keep money flowing to lenders
''This settlement will help homeowners stay in their homes, which ultimately helps investors and also helps communities,'' said Madigan, a Chicago Democrat.
Comments
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Sterling, Oh
Posted 01:18 PM, 10/06/2008
Bank of America scamming consumers to fund $8 billion of defaulted mortgages they issued. Is defiant of realities demands. And supports the demise of Natural Law, God, democracy, capitalism, the US Constitution, and free, fair, and affordable commerce. Makes funding schools IMPOSSIBLE; Makes free, fair, and affordable commerce IMPOSSIBLE. Makes balancing every budget IMPOSSIBLE. Makes union workers, consumers, taxpayers, and America’s grandchildren’s children LIFE UNAFFORDABLE. And created the $40 trillion social security and the $9.3 trillion national debt. America’s grandchildren’s children are responsible to pay interest with until they are 18 years old.
Then pay the debt with the $6.85 per hour labor wage. Twenty five percent of We the stupid, defiant of demands of natural law (what Mother Nature, God, or Whatever Power decreed to be the reality of the real world) God, democracy, capitalism, the US Constitution, and free, fair, and affordable commerce. Deceived in Sunday schools, public schools, private schools, and home schools, colleges, and universities government of the people, by the people, for the people, elected legislators and representatives to enact.
There is no reason to believe America’s grandchildren’s children that go to bed hungry can afford life and pay this debt with money derived from wages or independent business profit in a hundred million years.
