October 6, 2008
LANSING - Attorney General Mike Cox today announced a major settlement between the State of Michigan and Countrywide Financial, the nation's largest mortgage lender, resulting from allegations of predatory lending. The settlement will provide relief for more than 10,000 current and former Michigan homeowners who are struggling with the national home foreclosure crisis.
"Through our negotiations, we have provided a helping hand to thousands of Michigan families who are struggling with the foreclosure crisis," said Cox. "And, unlike the Wall Street mess, this was no bailout. Countrywide is paying, not the taxpayers."
Cox conducted national negotiations with Countrywide and other state attorneys general due to allegations of questionable lending practices. Those lending practices included misleading marketing techniques and incentives for selling loans with risky features, which may have contributed to the national increase in foreclosures.
As a result of the negotiations, Countrywide must offer to refinance thousands of Michigan mortgages, provide millions in financial assistance and stop questionable loan practices.
Under the terms of the settlement, Countrywide will:
Refinance as many as 9,700 mortgages in Michigan, giving families an opportunity to keep their homes, and saving them approximately $129 million as a result of more favorable terms.
Pay relocation assistance payments to certain homeowners who go into foreclosure after the date of this settlement, costing Countrywide up to $70,000,000 nationally.
Homeowners who acquired a loan from Countrywide Financial can call the Countrywide hotline for more information at 1-800-669-6607.
Citizens who feel they are victims of questionable lending practices can file a complaint with the State of Michigan Office of Financial and Insurance Regulation at 1-877-999-6442 or the Attorney General's Consumer Protection hotline at 1-877-765-8388.