Photo: Bank Of America Pays Discrimination Fine
The Justice Department today reached a $335 Million settlement to resolve allegations of lending discrimination by Countrywide Financial Corporation (purchased by Bank of America in 2008) on behalf of more than 200,000 African-American and Hispanic Borrowers who qualified for loans but were charged higher fees or placed into subprime loans.
This is DOJ’s largest residential fair lending settlement in history and relates to a widespread pattern or practice of discrimination againt qualified Latino and African-American borrowers in their mortgage lending from 2004 through 2008.
The settlement provides $335 million in compensation for victims of Countrywide’s discrimination during a period when Countrywide originated millions of residential mortgage loans as one of the nation’s largest single-family mortgage lenders. The settlement, which is subject to court approval, was filed today in the U.S. District Court in California.
The complaint alleges that these borrowers were charged higher fees and interest rates because of their race or national origin, and not because of the borrowers’ creditworthiness or other objective criteria related to borrower risk.
The United States also alleges that Countrywide discriminated by steering thousands of African-American and Hispanic borrowers into subprime mortgages when non-Hispanic white borrowers with similar credit profiles received prime loans.