Mortgage lender Countrywide Home Loans, whose aggressive home loan marketing has already broght intense criticism for its overly lenient home loan underwriting standards, may be facing further investigation by the Illinois Attorney General's office.
Deborah Hagan, Chief of the Consumer Protection Division of the Illinois Attorney General's office, confirmed a subpeona was served on Countrywide in early September, 2007. The office is seeking information on Countrywide's Illinois loan originations, funding, and collateralization.
The action grew out of a lawsuit filed in November, 2006 against One Source Mortgage, a local mortgage broker who used Contrywide for primary funding on most of its loans. The lawsuit alleged that the broker violated Illinois consumer fraud laws, and obtained loans for consumers they could not reasonably afford. One troublesome product were pay-option adjustable rate loans, many of which are currently facing default.
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