Race Discrimination Alleged In Subprime Predatory Lending Lawsuit Filed In Boston; Class Action Status Sought

The Boston Globe reports:

• "Three African-American mortgage borrowers from Boston accused Countrywide Home Loans Inc. of racial discrimination in a federal lawsuit yesterday, saying the nation's largest home lender charged them more for subprime mortgages than it charged white borrowers in similar financial situations. The lawsuit ... contended Countrywide violated federal housing discrimination laws because the black homeowners in Boston paid higher fees to the network of agents that generate Countrywide's new customers. The company, the suit said, uses an "unchecked, subjective surcharge" that adds to the total costs of loans for its customers, and black borrowers, it contended, paid more than whites. The suit seeks class-action status and more than $100 million to reimburse black customers of Countrywide and its subprime subsidiary, Full Spectrum Lending Inc., including about 10,000 in Massachusetts."

This lawsuit, filed by Massachusetts attorney Gary Klein on Thursday in a Boston Federal Court, comes on the heels of a suit filed on Wednesday by the NAACP in a Los Angeles, California Federal Court in which it sued a dozen subprime lenders for "systematic racism," charging blacks were 30 percent more likely to pay higher interest rates than whites (see NAACP suit targets mortgage lenders - Rights group alleges whites offered better terms than blacks on home loans).

Reportedly, similar litigation alleging discrimination in predatory lending practices against Argent Mortgage Co. and Wells Fargo Bank is also pending in Cleveland, Ohio (see Sue The *astards! - What To Do About Mortgage Brokers And Lenders Who Don't Play Fair?).

Last December, the New York Attorney General reached a settlement with Countrywide in which the company must monitor its lending practices to prevent discrimination against blacks and Latinos (see New York AG Press Release - 12-5-06).

For more, see Borrowers sue subprime lender, allege race bias (Countrywide denies blacks were charged more in fees).

For a copy of the Boston Federal lawsuit, see Miller, et al. vs. Countrywide, et al.

Go here, Go here and Go here for more on recent Countrywide problems with consumers.

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