Dog bites man, I know, but read this piece from ProPublica’s Paul Kiel on how Nevada “dramatically expanded” its lawsuit today against BofA/Countrywide:
Nevada’s attorney general charges that Bank of America and the now-defunct mortgage giant Countrywide acquired by the bank in 2008, deceived borrowers and investors at almost every stage of the process.
According to the suit, borrowers were duped into unaffordable loans and then victimized again through a misleading mortgage modification program that homeowners tried to use to avoid foreclosure. Finally, the bank filed fraudulent documents to move forward with the foreclosures.
“Taken together and separately, [Bank of America’s] deceptive practices have resulted in an explosion of delinquencies and unauthorized and unnecessary foreclosures in the state of Nevada,” the suit alleges.
Gretchen Morgenson on the Nevada suit:
In her filing, Ms. Masto contends that Bank of America raised interest rates on troubled borrowers when modifying their loans even though the bank had promised in the settlement to lower them. The bank also failed to provide loan modifications to qualified homeowners as required under the deal, improperly proceeded with foreclosures even as borrowers’ modification requests were pending and failed to meet the settlement’s 60-day requirement on granting new loan terms, instead allowing months and in some cases more than a year to go by with no resolution, the filing says…
One worker said in a deposition cited in the complaint that employees were punished if they spent more than seven minutes or 10 minutes with a customer. Even though these limits allowed almost no time for assistance, Bank of America employees who did not curtail their conversations with troubled borrowers were reprimanded or fired, this employee said.
Then there’s Lauren Tara LaCapra’s Reuters scoop that Bank of America knew for seven months that AIG was weighing a massive lawsuit against it for seven months but didn’t tell investors.
Oh yeah, and U.S. Bank wants a piece too. It said today it’s suing Bank of America over a $1.75 billion pool of toxic loans because it was misled on more than two-thirds of the loans.