Bank of America Requests for Countrywide Lawsuit to be Dismissed

by on Bank of America Foreclosures

Bank of America in Times Square

Amidst the foreclosure settlement agreements and other litigation surrounding the real estate market crash, Bank of America was also being pursued by federal prosecutors in regards to bad home loans that Countrywide Financial sold to Fannie Mae and Freddie Mac. Bank of America acquired Countrywide Financial in 2008 and the lawsuit covers actions from 2007 to 2009.

Apparently Bank of America told investors that the home loans were “quality” when the truth came out that this was not the case and that Bank of America was pushing the bad loans away from them as quickly as possible, essentially making investors take the hit. Bank of America claims that they did not know the loans were bad.

Nonetheless, the lawsuit was officially filed in October 2012, but now there are questions about whether the actions were a breach of contract by Bank of America or fraud. Federal prosecutors are pushing for fraud while Bank of America argues that fraud did not take place. The lawsuit is for $1 billion and Bank of America has recently requested that the lawsuit be dismissed due to a lack of factual information.

Apparently the judge has stated that he will announce a ruling in two weeks – at which time everyone will find out if Bank of America will be held accountable for selling the bad loans to investors or if they will get off scotch free.

Bank of America Faces Upcoming May Report

At the same time, Bank of America and other major lenders involved in the largest foreclosure settlement agreement will soon face the results of a report about whether these lenders are following through with their end of the foreclosure settlement agreements.

It will be interesting to see if these “internal” reviewers actually produced unbiased reports or if we have a repeat of the Independent Foreclosure Review process that was an epic fail.

Either way, many people believe that these major lenders – including Bank of America – are getting off light for their unethical actions, including but not limited to robo-signing. The video below has more information about this viewpoint.

One thing is certain, the ruling in two weeks will determine if Bank of America gets off light again with a mere slap on the wrist or if they are actually held accountable for their actions and the results these actions had on Fannie Mae and Freddie Mac.

Image source: SeanPavonePhoto / Shutterstock.com

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