June 25 (Bloomberg) -- Countrywide Financial Corp. and its chief executive officer Angelo Mozilo will be sued today by Illinois for allegedly engaging in deceptive trade practices in connection with loans to homeowners in the state.

In the suit, to be filed in state court in Chicago, Illinois, Attorney General Lisa Madigan claims Countrywide and Mozilo misled Illinois borrowers into taking risky loans they couldn't afford, Robyn Ziegler, a spokeswoman for Madigan, said today. It targets loans that were foreclosed, are in danger of being foreclosed or that were sold to other lenders, she said.

Madigan seeks to have the loans rescinded or rewritten, Ziegler said. Madigan is also asking the court to give her office 90 days to review the loans, Ziegler said.

Countrywide shareholders are voting today on a takeover offer proposed by Bank of America Corp. in January. The mortgage lender has lost $2.5 billion amid rising defaults and foreclosures.

Rick Simon, a spokesman for Calabasas, California-based Countrywide, didn't immediately return a call seeking comment.

To contact the reporter on this story: Bob Van Voris in New York at rvanvoris@bloomberg.net

Last Updated: June 25, 2008 09:14 EDT