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Released: December 22, 2011

Bank of America to pay $335M to settle claims of unfair Countrywide loans

Source: Brady Dennis, Washington Post (Free Registration)

Bank of America agreed Wednesday to pay $335 million to settle federal claims that its Countrywide Financial unit charged black and Hispanic borrowers higher mortgage fees in the lead up to the financial crisis and steered them into riskier loans than their white counterparts.

Obama administration officials said the settlement, the largest ever for fair-lending claims, came after investigators reviewed more than 2.5 million home loans originated by Countrywide during the housing boom.

Investigators concluded that Countrywide charged more than 200,000 blacks and Hispanics higher fees and interest rates than comparable white borrowers between 2004 and 2008. In addition, officials claim the firm advised more than 10,000 minority borrowers to take riskier and more costly subprime loans, even though they could have qualified for more traditional mortgages.

Read Full Article: Bank of America to pay $335M to settle claims of unfair Countrywide loans