Wednesday, February 27, 2008

Class Action Sought Against Countrywide For Allegedly Squeezing Homeowners With Improper Fees When Servicing Mortgage Loans

The Tampa Tribune reports:

  • Countrywide Financial Corp., the largest U.S. mortgage lender, is being sued by the estate of a Florida woman and accused of charging borrowers improper foreclosure fees. Starting in February 2002, Countrywide overcharged for attorneys' fees tied to foreclosures and imposed unjustified interest, escrow and late charges, according to a complaint filed Monday in federal court in Wilmington, Del.

  • "As a result of Countrywide's improper practice of overcharging fees and expenses, those borrowers who have enough funds to pay past due debt and other foreclosure costs, but are unable to pay the greater sums, remain subject to losing their homes," lawyers for Gregory O'Gara, who sued as executor of the estate of Tamara Portnick, said in the complaint.


  • O'Gara accused Countrywide of making arrangements with attorneys for flat, per-case rates of about $300 to $500 and then charging the homeowners $1,200 to $2,000 for the expenses. The company also was accused of charging excessive fees for appraisals, from $300 to $500, regardless of whether an appraisal is really done on the property. If fees are not paid by borrowers, they are added to the settlement amount on a foreclosure sale of the property, the complaint states. [...] O'Gara asked for class-action status for the lawsuit, [...].

For more, see Countrywide Sued Over Borrowers' Foreclosure Fees.

Representing the homeowners are Carmella P. Keener, of Rosenthal, Monhait, & Goddess, P.A., Wilmington, DE; and Jeffrey M. Norton, of Harwood Feffer LLP, New York City.

To view the lawsuit, go to this this direct link on the PACER system (approx. 2 MB - PACER registration required - 52 pages - $2.40); or drop me a line at and I'll e-mail it to you (please put "O'Gara v. Countrywide Complaint" in the subject line).

For another lawsuit with similar allegations against Mortgage Electronic Registration Systems (aka "MERS"), see MERS Clipping Homeowners In Foreclosure With Inflated Legal & Appraisal Fees, Says Class Action Lawsuit.

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