Bank of America settles lawsuit over bad mortgages - KWWL - Eastern Iowa Breaking News, Weather, Closings

Bank of America settles lawsuit over bad mortgages


SPRINGFIELD, Ill. (AP) - A Bank of America Corporation subsidiary is agreeing to modify tens of thousands of loans to keep people in 11 other states from losing their homes.

That's according to attorneys general in several states, including Iowa.

Bank of America is facing a lawsuit over deceptive mortgage practices involving Countrywide Financial.

According to the settlement, borrowers stuck with mortgages they can't afford could see their interest rates reduced or have the loan principal cut.

In Iowa, Attorney General Tom Miller says more than 1,100 residents will be offered help avoiding foreclosure. He says up to half of all Countrywide subprime loans in Iowa are delinquent.

If all 50 states were to join, the settlement could provide $8.7 billion in relief to 400,000 borrowers.

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