Banks seriously discussing Options in pending Foreclosure Deal
In a very closely watched match, several U.S. Banks are seeking to broker a deal with state attorneys general, in an effort to avoid billions in court claims over faulty foreclosure seizures.
The banks in talks include, Bank of America Corp. (BAC), Wells Fargo & Co. (WFC), JPMorgan Chase & Co. (JPM), Citigroup Inc. (C) and Ally Financial Inc.
The proposed deal on the table includes options such as paying penalties, pledging relief to home buyers, which can include reducing loan principal, cutting fees or paying moving costs.
Settling the documentation lapse during home seizures is at the forefront for state and federal officials. The attorneys general told the banks earlier this week that they face an estimated $17 billion in civil case court claims. The banks had initially offered to settle the improper foreclosure claims for $5 billion.
The proposed agreement has several sticking points that all sides must agree upon. For instance, the states would determine how best to use the funds from the penalties that the banks will pay. The banks want a global settlement that includes state and federal agencies. The banks are looking to include current and future claims in the settlements.
Last month, the 14 largest mortgage servicers, agreed to pay back homeowners for losses from foreclosures or loans that were mishandled.
As a Florida Foreclosure Defense Law Firm, we can’t help but ask can the banks be trusted? Will these proposed deals have options that give adequate borrower relief? What will the penalties be if the banks break their word as they have done so frequently in the past?
Since there is no crystal ball to predict the future, time will tell if an agreement will be reached. There needs to be an agreement that is mutually beneficial to the homeowner, not one sided for the powerful banking giants at the expense of the taxpayers.
Foreclosure Deal May Give Banks Options - Bloomberg News
Brian F. LaBovick, Esq.
Esther Uria LaBovick, Esq.
Mark R. Hanson, Esq.
Joseph R. Fields Jr., Esq.
Marcie Dodson, J.D.