Attorney General Corbett announces distribution of $2.7 million in foreclosure relief to PA residents as part of Countrywide Financial settlement

HARRISBURG, PA – February 17, 2010 – (RealEstateRama) — Foreclosure relief checks totaling more than $2.7 million have been mailed to several hundred Pennsylvania consumers as part of a multi-state settlement with Countrywide Financial Corporation.Attorney General Tom Corbett said the foreclosure relief is part of a broad-based package intended to assist borrowers in Pennsylvania who were allegedly misled by Countrywide and encouraged to take out mortgage loans they did not understand and ultimately could not afford.

Corbett explained that this portion of the settlement was created to assist qualified borrowers whose Countrywide loans resulted in foreclosure.  All eligible Pennsylvania consumers received claim forms and instructions in 2009.

Corbett said a review of the claims returned by consumers identified a total of 630 Pennsylvania Countrywide borrowers who were eligible for foreclosure relief.  Each of those consumers will receive a payment of $4,364.57. The checks, along with official notification letters from the Attorney General’s Office, should be delivered to all consumers within the next week.

Corbett noted that the Attorney General’s Bureau of Consumer Protection is involved in an ongoing effort to assist several thousand Pennsylvania homeowners who became entangled in the national controversy involving subprime and adjustable rate mortgages involving Countywide.

“The foreclosure relief being distributed this week is one part of a multi-million dollar effort to assist Pennsylvania consumers who have suffered because of Countrywide’s lending practices,” Corbett said.

Corbett noted that the Countrywide settlement agreement includes various forms of assistance for other borrowers, including:

• Affordable, streamlined loan modification offers to qualified subprime and pay option adjustable rate mortgage borrowers in Pennsylvania;
• Waivers of default/delinquency fees, loan modification fees and prepayment penalties under specified conditions;
• Relocation assistance in the form of cash payments to qualified consumers to help in their transition to a new residence.

“To date, a total of 2,560 Countrywide loans in Pennsylvania have been modified – saving consumers more than $26.5 million in reduced principal and interest,” Corbett said. “Also, loan modification offers have been made to an additional 1,500 borrowers, which could result in another $44.7 million in savings for consumers.”

Corbett noted that consumers can call the settlement administrator’s hotline at 1-866-411-6987 for more information about their eligibility for foreclosure relief.  Additional questions may be directed to the Bank of America/Countrywide hotline at 1-800-669-6607.

Consumers with concerns or complaints are encouraged to contact the Attorney General’s Consumer Protection Hotline, at 1-800-441-2555, or file an online consumer complaint.