A multistate settlement with the parent of mortgage giant Countrywide Financial Corp. could deliver $130 million in loan relief to more than 6,800 Colorado borrowers, the Colorado attorney general’s office said Tuesday.
The record $8.7 billion settlement, announced Monday, resulted from predatory-lending lawsuits filed by Illinois, California and other states. Eleven states, not including Colorado, participated in the settlement, but the terms are being offered to all states.
Colorado Attorney General John Suthers is considering whether to join the settlement or pursue independent action against Bank of America, which recently bought Countrywide.
If Colorado were to join the settlement, Countrywide would offer loan modifications worth $122 million to 6,800 delinquent borrowers in the state who have a total unpaid principal balance on Countrywide loans of $1.2 billion, said Suthers spokesman Nate Strauch.
The modifications would include switching borrowers from high-risk loans to traditional 30-year fixed-rate loans.
Other forms of relief, including waivers of prepayment penalties and delinquency fees, would total nearly $8 million, Strauch said.
Bank of America officials said the deal will save the bank money in the long term because it will reduce the number of foreclosed loans.
Greg Griffin: 303-954-1241 or ggriffin@denverpost.com
