State enters settlement agreement
with Countrywide Financial Corp Attorney General Larry Long announced that South Dakota has entered into a settlement with Countrywide Financial Corporation, and several of its affiliated entities, over the marketing of subprime and other high-risk mortgage products in South Dakota. As part of the agreement, Countrywide will make $161,805 available to eligible South Dakota borrowers. Ninety-three South Dakota consumers qualify for the foreclosure relief program and an underdetermined number of borrowers will qualify for the loan modification program. These consumers will be notified by mail in the next couple of weeks. Under the settlement agreement, Countrywide will help its borrowers who are in default or facing foreclosure save their homes through fast-track loan modification on subprime or option-ARM loans, resulting in reduced mortgage payments. The program offers a series of loan modifications, including lowering the interest rate as low as 3.5 percent for five years to make house payments more affordable. Alternatively, Countrywide can make loans interest-only for up to ten years. Countrywide has already begun contacting eligible borrowers in South Dakota to determine if they qualify for a loan modification under the settlement. The settlement agreement requires Countrywide to complete the modification for a borrower within 60-days of that borrower providing income information. During this time, any foreclosure proceedings are suspended. In addition, Countrywide will write-off late fees and waive prepayment penalties on modified loans. Borrowers that do not qualify for a loan modification under the settlement, or who previously went into default and lost their homes to foreclosure after only a few payments, may be eligible to receive compensation under the settlement. For additional information about this settlement contact Countrywide Financial at this toll-free number 1-800-669-6607. You may also contact the South Dakota Consumer Protection Division at 1-800-300-1986.
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