City attorney sues lender in 'foreclosure sanctuary' plan

24 July 2008

The city attorney of San Diego has filed suit against the Countrywide mortgage-lending unit of Bank of America.

Falling house prices and rising repossession rates in the US are at the root of the legal action, as the official attempts to make the city a "foreclosure sanctuary".

The lawsuit aims to prevent the lender from repossessing properties within his jurisdiction, and therefore bids to prop up the local housing market.

City attorney Michael Aguirre commented: "We are asking that any additional foreclosures be stopped and that the parties come together and work out a reasonable alternative based on the values of these properties today so we can stop the spread of this foreclosure disease."

He added: "We would like to see San Diego become a foreclosure sanctuary."

Mr Aguirre is also planning lawsuits against Wachovia, Wells Fargo and Washington Mutual - banks which are also attempting to foreclose on local residents.

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