Countrywide to Begin Making Settlement Payments in 2010

8 08 2009

Countrywide Financial, now owned by Bank of America, will soon begin making cash payments of at least $3,000 to each of its Florida customers who have experienced a foreclosure or fallen behind on mortgage payments within four months of getting their loan.

The cash payments are part of a $1 billion settlement the company reached last year with the Florida attorney general to avoid prosecution for allegedly hoodwinking customers into taking out subprime mortgages and other risky, high-cost loans. Ten other states also reached agreements with the company for a combined $8.4 billion in mortgage relief, which also includes loan modifications.

In all, about 5,700 Florida borrowers are entitled to about $17 million under a Foreclosure Relief Program established as part of the settlement. Countrywide will pay another $4 million to the attorney general’s office. Last month, the office announced it would use the money to fund a foreclosure defense grant program through the Florida Bar Foundation. Letters notifying borrowers eligible for the payments began going out last month.

In the letters, Countrywide told borrowers that in agreeing to accept the settlement payment, they were also agreeing to give up any legal claims against the company and its affiliates, including joining any class-action lawsuits. To receive a payment, borrowers have to sign and return the claim form and release by Oct. 22.

Each eligible borrower will get at least $3,000, and possibly more, depending on how many people mail in the claim and release forms.

Checks will start being mailed in early 2010, the company said.

If someone thinks they maybe be eligible for a payment, but did not receive a letter, the attorney general said they should call the office’s fraud hot line at (866) 966-7226. They can also try Countrywide’s settlement administrator at (866) 411-6987, or, for the hearing impaired, (866) 494-8397. They can also visit

%d bloggers like this: