Like someone who thought they were buying a nice little fixer-upper at a bargain only to find that every ounce of the property is covered in lead paint and asbestos, Bank of America’s 2008 purchase of Countrywide Financial continues to eat away at the company’s coffers.

The latest in the long line of settlements related to Countrywide’s bad business dealings came this morning, when BofA agreed to a $11.6 billion settlement with Fannie Mae, which purchased huge amounts of toxic countrywide mortgages during the years leading up to the collapse of the housing market.

According to the Wall Street Journal, BofA will pay $3.55 billion in cash to Fannie, with another $6.75 billion going toward repurchasing the questionable mortgages sold off by Countrywide. Fees of $1.3 billion will be paid to Fannie for its role as a loan payment processor for the collapsed company.

Fannie had been demanding that BofA repurchase $11.2 billion in Countrywide loans issued between 2000 and 2008. As the housing market went SPLAT, it came out that the lender was engaging in questionable and deceptive business practices — providing loans to customers who were not qualified, misleading borrowers about interest rates on adjustable-rate loans, systematically pushing minority applicants into subprime mortgages even when they could qualify for standard loans, and repackaging all these iffy mortgages off to other investors without disclosing all the risks involved.

A comfortable estimate pegs Bank of America’s costs associated with the Countrywide purchase (and its similar saving of a failing Merrill Lynch) at more than $44 billion… so far.

While the Fannie Mae fight was the biggest hurdle remaining in BofA’s race to put the Countrywide ugliness behind it, there is still the $1 billion lawsuit by the federal government that accuses the lender of running a program — dubbed The Hustle — between 2007 and 2009 that effectively removed all the standard toll gates to loan approval so that Countrywide could sell as many loans as possible to Fannie Mae and Freddie Mac.

In November, it was revealed that the former Countrywide executive in charge of that program is now running Chase’s foreclosure review department.

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