B of A announced today that it’s dropping the Countrywide name from the troubled company it purchased and replacing the name with Bank of America Home Loans. Why is this significant and how does it apply to you?Here’s my take on it. Countrywide was been a big player in the subprime meltdown. I remember when Angelo Mozilo, former head of Countrywide was interviewed by Maria Bartiromo for Business Week magazine and she asked if Countrywide was part of the problem due to all the subprime mortgages they sold.
If my memory serves me, Mozilo’s reply was that no one was complaining when investors were flipping properties and making tens of thousands of dollars for holding a property for a matter of months, and no one was complaining when the homeownership rate rose steadily and opened up the opportunity for many more people, etc, etc….
I also remember him saying Countrywide as done more to expand homeownership, blah, blah…..
Well as the story unfolds, here are the facts. Senator Christopher Dodd received a sweetheart mortgage (points waived on first and 2nd mortgage) and he was on a “vip’ list of favored Countrywide customers.
Dodd is also chairman of the Senate Banking Committee and received just shy of $5mil in campaign donations in 07-08 from financial services firms.
Countrywide was sued in July 08 by the Attorney General of CA on behalf of constituents for deceptive lending practices- Case: LC081846.
B of A recently settled this claim for over $8.7 billion dollars. With that kind of baggage a name change is the least they can do to bury the problem.
It’s going to take a lot more than a name change and aggressive marketing to bury all the damage Countrywide was allowed to perpetrate on homeowners.
How it applies to you is that you are now armed with a growing body of case law to fight back against your lender. This case law combined with a forensic audit (if needed) can give you the leverage you need to help modify your loan and keep your home.
