California Attorney General Jerry Brown filed a lawsuit today against Countrywide Financial charging that the company forced risky loans on unassuming customers. That means the state joins Illinois in suing the company. Read on:

[Brown] alleged that Countrywide also pushed pre-payment financial penalties that boosted profits and kept people from refinancing out of the loans.

The lawsuit singles out a variety of “teaser rate” loans that Countrywide and other lenders specialized in as housing prices rose. Those offered interest rates as low as 1 percent.

The state said many borrowers mistakenly assumed those were permanent rates because Countrywide often offered that impression. Borrowers then quickly found themselves making higher monthly payments than they expected or could afford.

He gets even more detailed on his own press release where he takes the company to task for “Hiding total monthly payment obligations by selling homeowners a second mortgage in the form of a home equity line of credit,” and “Making borrowers sign a large stack of documents without providing time to read the paperwork.” 

 Oh, it gets interesting every day in the State of California!

I should have noticed something was up when I saw them pulling down the Countrywide Loans signs in Benicia’s Southampton Plaza. I just saw them put up WaMu posters this weekend. That shouldn’t last long either!