Many states are jumping on the bandwagon and suing Countrywide for their unscrupulous business dealings. This effort may be seen as an effort to fight against all lending companies that during the big real estate boom made money from unaware homebuyers.

Attorney General Darrell McGraw filed suit against Countrywide Financial Corporation, Countrywide Home Loans, Inc., Countrywide Home Loans Servicing, LP, Full Spectrum Lending, Inc., and Angelo R. Mozilo, individually and as CEO of Countrywide Financial Corporation.

McGraw is alleging that Countrywide made loan arrangement in the state of West Virginia that were unaffordable and insensible. The loans not only have affected consumers in the state of West Virginia but throughout the US. The question is, was Countrywide the only real estate broker wanting to get it on the real estate bubble and make billions of money before the bubble burst?

A few of the ways that Countrywide enticed homebuyers is the same exact ways that many other lending companies were working with consumers over the last few years. These examples include offering a teaser rate for between two and five years, then resetting the interest rate at a much higher rate which made the loans unaffordable. This is not the only way they enticed consumers. Other such enticements including no down payment. However, with the no down agreement in 15 years a large balloon would be due that was close to the same amount the homebuyer borrowed in the first place.

Question. Who is watching over the lending practices of any type of lending institution? When loan companies such as Countrywide can scam people into making a loan higher than they can afford, the entire economy suffers. Not only will the property value go down in the neighborhood where the foreclosure happens to be, but also as you are seeing today, many banks are in trouble. Investors pull their money out of the lending market, then you see banks and the stock market weakening.

More real estate agents need to work alongside their homebuyers and home sellers when it comes to working with any lending company. If more agents were involved in the process and really have their clientele’s best interest at heart, they could help prevent such catastrophes. If homebuyers would sit down with their real estate agent and fill out all the appropriate information, the agent could show them how much they could afford to pay monthly. Not only this, but agents could explain all the tricky wording of the various loans and explain to their clientele what all of these means to their pocket. In order to fight the big dogs, you have to know what you are up against and working together with knowledgeable and trustworthy real estate agents may be the biggest key to the real estate slump. Consumers do not know whom they can trust when they see big lending companies such as Countrywide scamming them so they lose their homes.

Yes, this will be work for the agent, however, as agents, a smile on the face of your clients for helping them find their dream home they can afford and the money you will make from a good deal should be worth the effort. Going that extra mile with a client will provide you with more clients and you will become a pillar among the rest of the agents and lending companies that look at clients as dollar signs.