Legal Blog

Compensation and Compliance Matters – February 3, 2014

The Feds Make an Example of Bank of AmericaNon-Qualified Mortgage Loans

In October Bank of America lost a jury trial for fraud brought by the United States based upon Countrywide’s high-speed approval process which was claimed to have incentivized fast approval at the expense of proper underwriting.

Specifically, it was claimed that the process encouraged improper approvals of loans that were immediately sold to Fannie Mae and Freddie Mac. The claim was that Countrywide and a midlevel executive, Rebecca Mairone, knew the loans were not creditworthy as a result of the deficient process, but nevertheless sold the loans to Fannie and Freddie.

Click here to read the entire blog by Ari Karen on National Mortgage News

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