Class Action Against Countrywide Alleges Abuse Of Hurricane Victims Behind In House Payments

According to a press release from the James, Hoyer, Newcomer & Smiljanich, PA Law Firm:

• In response to Countrywide Home Loans refusal to fulfill promises made to Gulf Coast hurricane victims, the James Hoyer Law Firm announced [last month] the filing of a new class action lawsuit against the mortgage company. The suit was filed in the United States District Court in the Southern District of Mississippi. The suit alleges Countrywide took advantage of these disaster victims by offering them mortgage deferrals with no penalties attached and then reneging on that promise.

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• After Hurricanes Rita & Katrina, Countrywide offered 90-day mortgage payment deferrals to homeowners affected by the devastation and in many cases 6-month deferrals. Countrywide represented this as a good deed to help people in their time of suffering and even issued a press release to promote its actions. Homeowners were told by agents over the phone their deferred payments could be tacked onto the end of their mortgages. They were assured they would not face penalties like late fees, interest and reports to the credit bureaus. Countrywide went so far as to tell homeowners who wanted to pay, not to do it. In some cases, they even returned checks. Struggling hurricane victims accepted the offer of help, some reluctantly, when assured they would not be economically penalized by late fees, penalties or credit reporting.

• When homeowners followed up later to resume payments, they discovered Countrywide was reneging on its promise. The company said it could not add the payments to the end of the loan, without penalty, after all. Instead, Countrywide told homeowners they would either have to pay the lump sum owed immediately or face a loan restructuring which would cause them to pay thousands of dollars more over the life of their loan.

• The suit, filed on behalf of victims in Mississippi, is in addition to two suits already pending in Louisiana and Texas.

For the press release, see Countrywide Class Action Suit: Hurricane Victims Feel Betrayed.

Go here for:

• ABC News report on Countrywide Hurricane Victims (video only),
• Countrywide Loan Investigation (video only).

To view the lawsuit, drop me a line at HomeEquityTheft@yahoo.com and I'll e-mail it to you (be sure to put "Brumfield v. Countrywide Home Loans" in the "Subject" line).

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