Connecticut Accuses Countrywide For Foreclosure Blues

Connecticut is the fourth state to legally accuse Countrywide Financial Corporation for foreclosure blues. The allegation is that this giant mortgage body transgressed all state banking and consumer laws. It made house loans to buyers who were not qualified for these. In no uncertain terms the charge has been made that Countrywide resorted to “oppressive, unethical, immoral and unscrupulous” means to dupe the gullible borrowers to contract these loans. Today they are facing foreclosure. Richard Blumenthal, the Attorney General filed the case in the Superior Court, Hartford. Blumenthal was harsh in his criticism that the firm was “directly and disgracefully” exploiting these borrowers. Previously similar legal steps have been taken by the states of California, Illinois and Florida.

Angelo Mozilo founded Countrywide in 1969. The Bank of America has purchased Countrywide. In the defamation suit the bank has not been named as a defendant. The bank declined to make any comments when Countrywide referred requests. Shirley Norton, a spokesperson of Bank of America said that the bank would respond to the Attorney General when the time comes. She gave the reply in via e-mail.

Countrywide is the biggest mortgage lender in the country. Today it has become an icon of foreclosure blues. Its aggressive toeing the line of sub-prime mortgage lending is said to be largely responsible for mass foreclosures that is dragging down the economy of the country.

There are rumblings and grumbling about what is going on in the corridors of power. Many senators, not excluding Christopher Dodd (D-Conn), are said to have accepted loans from Countywide through a special VIP Programme dubbed ‘Friends of Angelo.’ Dodd replied that he was not aware of being given preferential treatment.

Little information was available regarding the functioning of Countrywide in Conncecticut from Blumenthal except that it was “one of the biggest mortgage companies operating” in this region.

It is alleged in the suit that the agents representing Countrywide improperly inflated the incomes of the customers so as to make them eligible for the loans. In other instances the clients were put under to pressure to contract adjustable rate mortgages that were not in tune with their affordability levels. Blumenthal said that his office is proceeding with further investigations regarding other mortgage units and agents but did not go to naming any lender specifically. The suit against Countrywide does not mention specific consumers who have suffered from the activities of Countrywide.