People Going Back To Their Foreclosed Homes

August 14th, 2008

back to foreclosed homes

Richard Blumenthal, Attorney General along with the commissioners of the Department of Banking and Department of Consumer Protection has filed a case on 6th August against the Countrywide Financial Corp at the State Superior Court, Hartford. The allegation is that the Countrywide Financial Corp has violated several consumer protection as well as banking laws. It is expected that a large number of people in Connecticut who have lost their homes to Countrywide Financial Corp, will soon be getting them back or get a compensation to buy an altogether new home for them. Blumenthal has also said that he would try to get the homes on which foreclosures has been filed. This seems to be good news for the real estate in Connecticut.

The exact number of foreclosed homes cannot be rightly said but the number seems to be huge. A fine of up to $100,000 for every single violation of state banking laws and a fine of up to $5,000 for every encroachment of state consumer protection laws will be charged by the state. The Countrywide Financial Corp has charged over 400 cases of foreclosures within the state with a majority of them between 2006 and 2008 according to the website of Connecticut Judicial. Blumenthal has even said that if a family has already sold their home to someone else, then the state will take steps to provide compensation for that.

The Countrywide Financial Corp is facing lawsuits not only from the home state of California but from other states too. Besides, the customers in Connecticut have also filed case against them. The parent company of Countrywide that is the Bank of America has been asked by Blumenthal to make a suspension of all the foreclosed homes till this case was settled. He has said that Countrywide used to make people, whom it knew won’t be able to afford, to take loans. The lender hefted the income of the borrower in papers to make him qualify for the loan. But during closing, they used to produce some different terms and conditions that differed from the ones promised.

The Bank of America has assured to help customers for buying a home. Howard Pitkin, the Banking Commissioner has said that a request has been made before the court for an invalidation of the loans that were in violation of the state law. Countrywide used to be the biggest mortgage lender. But from the last year it has started to weaken in the midst of real estate prices going down and increasing loan defaults.