NJ Gets $3.7 Million In Countrywide Settlement

TRENTON, New Jersey (AP) — New Jersey will receive about $3.7 million from Countrywide Financial Corp. for a fund to help eligible homeowners and state programs as part of a nationwide settlement to resolve subprime mortgage complaints, the state said Thursday.

The state had alleged that Countrywide put borrowers in risky and eventually unaffordable sub-prime mortgages. In completing the settlement, Countrywide admitted to no wrongdoing.

Countrywide will create a foreclosure relief fund for New Jersey borrowers and state mortgage foreclosure mitigation programs. The state will receive half of the money to fund mortgage modification programs. The remaining half will be available to sub-prime borrowers who lost their homes to foreclosure after making six or less payments.

The state estimates 8,200 New Jersey residents will benefit from the agreement.

The $3.7 million is part of a $150 million nationwide settlement.

In addition, Countrywide has agreed to offer loan modifications to mortgage borrowers and to not begin foreclosure proceedings until determining whether a borrower is interested in staying in his or her home and whether the borrower's loan can be modified.