Settlement Over Mortgage Abuses May Come This Week
States have until the end of this week to decide whether they will agree to sign onto a settlement over mortgage abuses with the nation’s largest banks, Reuters News reports.
State and federal officials have been in settlement talks for more than a year but have been unable to reach an agreement.
The proposed deal would include mortgage principal write-downs for distressed home owners. Banks would also pay up to $25 billion. In return, state and federal officials would release banks from facing civil claims from any errors in servicing and originating loans, Reuters reports.
The banks involved in settlement negotiations are Bank of America, Wells Fargo & Co., JPMorgan Chase & Co., Citigroup, and Ally Financial Inc.
Some states have been reluctant to sign onto the deal, criticizing the settlement as being too lenient on banks.
Reuters News says that states have one week to make a decision about whether to sign on with the settlement. An announcement is expected next week.
Source: “States to Decide This Week on Mortgage Deal,” Reuters (Jan. 30, 2012)