Just as news was released about an $85 million fine imposed against Wells Fargo for predatory lending practices, Countrywide is starting to send out refunds per a $108 million settlement. Although the settlement was reached over a year ago the mortgage lender is just starting to send checks out. The refunds will go to home buyers who were overcharged by the financial institution.
Federal Trade Commission Chairman Jon Leibowitz said, “It’s astonishing that a single company could be responsible for overcharging more than 450,000 homeowners. Countrywide’s unconscionable behavior harmed American consumers on
a massive scale and we are proud to be getting every single dollar back to hundreds of thousands of struggling consumers who can least afford to lose the money.”
According to Frank Dorman, a spokesman for the Federal Trade Commission, there are two categories in which Countrywide overcharged customers. The first was from services such as home maintenance and inspections that were provided by Countrywide to home owners that were in default. Those services were provided by a subsidiary of the company which charged as much as double for the fees. Those overcharges were then passed onto the homeowner.
The second category includes overcharges from false claims and fees that were tied to escrow accounts for customers who had filed Chapter 13. The customers were not informed about any charges or fees at the time of the filing. The FTC says that those customers will get a refund of the entire amount of any charges or fees that were undisclosed. The refunds affect consumers who were in default on their loans between January 1, 2005 and July 1, 2008.
