California and New York, two big holdout states, join in a $25 billion mortgage settlement
BofA, mortgage settlement, refi, hold states,
(Reuters) – California and New York, two big holdout states in a $25 billion mortgage settlement, are expected to join the deal, smoothing the way for an announcement on Thursday, according to a person familiar with the matter.
Florida, with its large distressed housing market, was also close to joining the settlement that resolves civil government lawsuits over faulty foreclosures and servicing misconduct by top U.S. banks, a separate person familiar with the deal said on Wednesday.
The announcement will cap more than a year of chaotic negotiations among state and federal officials, and the banks, who have been accused of using robosigners and unlawful documentation to deal with a flood of foreclosures.
The Obama administration has estimated that up to 1 million homeowners could benefit from the deal through mortgage writedowns and other forms of relief.
The settlement has been billed as complementing other government programs designed to boost the housing market that has been a drag on the economic recovery, a key issue for President Barack Obama as he fights for re-election in November.
The settlement has been estimated at up to $25 billion in value, but federal officials have said the actual relief to homeowners could be closer to $40 billion because of the way the deal is scored.
The core group of banks involved in settlement talks are Bank of America Corp (NYSE:BAC – News), Wells Fargo & Co (NYSE:WFC – News), JPMorgan Chase & Co (NYSE:JPM – News), Citigroup Inc (NYSE:C – News) and Ally Financial Inc.
More than 40 states said they would join the settlement in advance of a February 6 deadline, but several states continued negotiations to address concerns specific to their state.
The value of the state and federal settlement would have dropped significantly if California and Florida decided not to join.
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Posted by TheNicheReport magazine
on Feb 9 2012. Filed under Archive, Breaking News, Featured, Politics.
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[...] Foreclosure Fraud Epidemic Sweeps the Country Foreclosure Fraud Epidemic(TheNicheReport.com) Alarming reports from diametrically opposed areas of the United States are revealing that mortgage lenders and the law firms representing them are still engaged in highly dubious foreclosure practices. Mortgage audits in California and North Carolina showed a high percentage of irregular foreclosures and forced evictions. One of the issues noted in those audits was “robosigning”, a questionable practice that lead to a nationwide investigation by state attorney generals and a multi-billion settlement by five major mortgage lenders. [...]