West Virginia Latest State to Sue Countrywide

August 13, 2008 No Comments »

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West Virginia has become the latest state to sue Countrywide, following similar suits filed by Attorney Generals in Florida, Illinois, California, and Connecticut.

In fact, it won’t be long until all 50 states are on-board, and perhaps even Puerto Rico.

Attorney General Darrell McGraw filed the suit against Countrywide Financial Corp., Countrywide Home Loans, Countrywide Home Loans Servicing, Full Spectrum Lending, and former CEO Angelo Mozilo personally.

The suit argues that the mortgage lender and its subsidiaries made loans to West Virginians that were “unaffordable and unconscionable,” adding that the companies used “unfair and deceptive” practices to make and service the loans.

It alleges that Countrywide induced consumers to take out exploding adjustable-rate mortgages and noted in one case that a consumer wasn’t able to refinance because the original appraisal was so highly inflated.

“Foreclosures in a neighborhood affect the value of all homes in that neighborhood,” said Attorney General McGraw. “Therefore, while the consumers facing foreclosure are directly affected by Countrywide’s practices, all homeowners are indirectly affected.”

It’s unclear what Mr. Mozilo is being targeted for, though Reuters noted that the suit is demanding Countrywide rescind all questionable mortgages, grant restitution to affected borrowers, and pay an unknown fine.

The obvious question now is, which state is next?

(photo: kubina)

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