LOS ANGELES (CN) – Bank of America will offer up to $8.7 billion in relief for homeowners facing foreclosure because of the predatory lending practices of Countrywide Home Loans. Bank of America bought Countrywide in July for $4 billion.
The settlement with 11 states’ attorneys general will allow as many as 400,000 borrowers to adjust their mortgages and stay in their homes by suspending foreclosures for borrowers with subprime and adjustable-rate loans. Relief offered includes reduced interest payments, forgiving of late fees and prepayment penalties, and granting payments to borrowers who are in danger of foreclosure. The settlement plan also will help relocate borrowers who already have lost their homes.