Almost 3,700 Michigan residents will be notified shortly that they are entitled to receive a piece of $6.6 million in restitution that Countrywide Financial gave the state of Michigan as part of a settlement reached with the Attorney General’s office.
Countrywide Financial was ordered to pay the money as part of a settlement agreed upon for “questionable lending practices,” which incorporated predatory lending, according to a statement made by State Attorney General Mike Cox.
“Countrywide took advantage of families trying to achieve the American dream,” Cox stated. “Though this settlement, families across Michigan will receive a helping hand.”
In October 2008, Countrywide and the attorney general’s office reached a settlement of $138 million, which included $129 million for the refinancing of nearly 9,700 Michigan mortgages.
The news of the company’s repayment to homeowners came as part of this previous settlement.
A little over $3 million will be given to support nonprofit organizations, charities and cities battling foreclosure.
There also were provisions made for the attorney general’s office to supervise Countrywide’s activities and to ban the institution from selling sub-prime and “option ARM” mortgages in Michigan for a minimum of two years.
Eligibility requirements for the settlement include individuals that have received sub-prime loans or pay-option loans between January 2004 and December 2007.
The homes also had to be foreclosed on between January 2004 and December 2008.
In addition, borrowers will receive a letter from the attorney general’s office, claim forms and postage-paid return envelopes.
A minimum individual compensation of $1,818.83 will be given, yet depending on the total number of borrowers who decide to participate in the settlement, that amount could increase.
The deadline to submit a claim is Oct. 22.