NEW YORK (Reuters) -– A group of bond investors sued Bank of America (BAC.N)-owned Countrywide Financial on Monday demanding that Countrywide buy every mortgage loan for which it agrees to reduce payments under a predatory lending settlement deal.
Countrywide and its Bank of America parent would be liable to pay hundreds of trusts a total of about $80 billion for loans it modifies, said lawyers for the plaintiffs who filed the complaint in New York State Supreme Court. Countrywide, ensnared by the subprime mortgage crisis, was the largest U.S. mortgage lender before Bank of America bought it for $2.5 billion on July 1. Under an agreement announced in October with 15 state attorneys general, Countrywide will modify mortgages for about 400,000 homeowners to settle allegations of predatory lending.
Countrywide and its Bank of America parent would be liable to pay hundreds of trusts a total of about $80 billion for loans it modifies, said lawyers for the plaintiffs who filed the complaint in New York State Supreme Court. Countrywide, ensnared by the subprime mortgage crisis, was the largest U.S. mortgage lender before Bank of America bought it for $2.5 billion on July 1. Under an agreement announced in October with 15 state attorneys general, Countrywide will modify mortgages for about 400,000 homeowners to settle allegations of predatory lending.
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