Brought to you by WBIW News and Network Indiana
Last updated on Friday, May 15, 2009
(UNDATED) - Up to 1,700 Hoosiers who bought their homes through Countrywide Financial will split a $2.85 million settlement of a lawsuit against the mortgage giant.
Indiana is one of at least five states to sue Countrywide, accusing the company of deceptive lending practices.
The suit, filed nine months ago, charges Countrywide lured buyers with low teaser rates, without disclosing the big jump in payments to come.
About 1,700 borrowers in Indiana ended up losing their homes.
Attorney General Greg Zoeller says the settlement gives foreclosure victims an average of about $1,600.
The actual amount depends on how many of those borrowers can be located, and how many of those opt out of the settlement to file suit on their own.
The settlement orders Bank of America, which bought Countrywide last year, to open negotiations with its remaining mortgage holders to rework their loans.
Zoeller says about 5,000 Hoosiers hold an estimated $54 million in Countrywide mortgages.
Zoeller calls Countrywide "the worst of the worst" subprime lenders, and says the state might have demanded more aggressive terms if Bank of America hadn't bought out the company.
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