Thursday, February 10, 2011

Countrywide Settlement Funds Mortgage Modification

Luke Ford writes:

Countrywide and other mortgage makers would quickly sell the mortgages they had made, so they had less incentive to make sure that the people who borrowed their funds could pay them back.

CSM reports:

The state had sued Countrywide, CEO Angelo Mozilo and President David Sambol under former Attorney General Jerry Brown. The 2008 lawsuit alleged that the company lured borrowers with low "teaser" rates on adjustable rate loans. Loan officers didn't tell borrowers that the rates would jump, that prepayments would be penalized, and the total loan costs would skyrocket, even if they made additional payments, the state alleged.