TALLAHASSEE, Fla. (AP) -- Florida's attorney general is investigating Countrywide Financial, a beleaguered California-based mortgage lender, for possible unfair and deceptive business practices related to its home loans.
The subpoena, dated Jan. 17, directs Countrywide to provide documents and other information describing procedures used to determine whether borrowers qualify for subprime loans, those for people with shaky credit.
The state also wants information on how Countrywide credited borrowers' payments any time after January 2005. It also asks for documents that track applications of borrowers' payments to bankruptcy debt and a description of fees charged to mortgage holders during the same period.
"We've had a number of complaints about Countrywide, as well as other mortgage companies in the subprime arena," Attorney General Bill McCollum told reporters Thursday. "[The complaints involve] how some of their business was conducted in terms of marketing and in terms of advertising."
McCollum is also interested in how Countrywide conducts itself with borrowers who find themselves in trouble. He said he was interested in comments made by several bankruptcy judges concerning how the company treats people seeking relief.
The attorney general's office started a mortgage fraud hot line last year. It has received about 150 complaints on Countrywide.
Countrywide, based in Calabasas, Calif., has until Feb. 11 to provide the information. Countrywide officials did not immediately return a phone call Thursday.
Attorneys general in Illinois and California are conducting similar investigations.
McCollum said he is also investigating other mortgage companies but has not filed any other subpoenas yet.
Countrywide, like many in the mortgage industry, has suffered under the weight of the subprime fallout as thousands of customers default on home loans. Many experts criticize companies like Countrywide for relaxing lending standards and contributing to the meltdown.
Earlier this month, Bank of America (BAC, Fortune 500) agreed to pay $4.1 billion in stock for Countrywide.
Countrywide (CFC, Fortune 500) shares were up 30 cents at $6.77 in midday trading Thursday. See Also
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