"Countrywide's unfair lending practices have harmed tens of thousands of borrowers who've been placed in unaffordable loans and, as a result, our communities are now being destabilized by a skyrocketing number of home foreclosures," Lisa Madigan said in a statement Wednesday. Her office said that the company played a "major role" in the foreclosure crisis, all in an attempt to dominate the U.S. mortgage market. "Countrywide repeatedly qualified borrowers for mortgage loans based on salaries that were significantly higher than what they really made," Madigan added. "As a result, Countrywide put borrowers into loans that they could never afford, leading to high failure rates." Among other things, the suit asks the court to rescind or reform all Countrywide loans originated "with the use of unfair and deceptive practices." "This includes providing financial relief to borrowers who lost their homes to foreclosure, refinanced, sold or have loans currently being serviced by Countrywide, even if that requires Countrywide to repurchase loans from current investor owners," according to Madigan's office. A spokesman for Countrywide couldn't immediately be reached Wednesday afternoon.
Mozillo is being sued personally as well. This will be interesting. I'm told today that there are 67 loan officers at CW who are being investigated in Illinois for putting people in these loans that the don't qualify for, specifically using MTAs, COFIs as well as other loans. I'm not sure about the veracity of this statement. There's a lot on the net about the mess CW is in, but a local recruiter for CW is now telling my loan officers that they're no longer a part of CW, but rather B of A now that the shareholders have approved the sale. I'm sorry, but just because you put a different mask on an ugly kid, it's still an ugly kid.
We've signed three local CW LOs in the last 2 months and are talking with others that are just marking their time until they leave. It'll be interesting to see how this all shakes out, but it seems that the name change alone won't changes reputation in Illinois. Only time will tell.