*Attorney General Lisa Madigan filed a lawsuit Tuesday against Countrywide, alleging the fallen mortgage industry giant discriminated against blacks and Latinos buying home mortgages in Illinois, reports the AP.
The lawsuit, filed in Cook County Circuit Court, claimed the Bank of America Corp., subsidiary steered minority borrowers into risky subprime mortgages more often than white borrowers, even when blacks and Latinos qualified for other types of loans.
The complaint also alleged blacks and Latinos were charged higher interest rates and fees than white borrowers in similar financial situations.
“It’s disturbingly clear that if you were an African American or Latino borrower who walked into a Countrywide store, you likely paid more for your mortgage than a white borrower,” Madigan said in a statement. “Countrywide effectively imposed a surcharge on mortgage loans based on race and ethnicity.”
Madigan’s office, which subpoenaed Countrywide in 2008, analyzed statistical data from more than 83,000 Countrywide mortgages in Illinois from 2005 to 2007 and interviewed company employees and borrowers. It found black and Latino borrowers were three times more likely than white borrowers to receive higher-cost subprime mortgages.
The complaint alleges the company violated the Illinois Human Rights Act and the Illinois Fairness in Lending Act. It names Countrywide Financial Corp., Countrywide Home Loans Inc., and Full Spectrum Lending, Inc., a division of Countrywide.