Feb. 2012 Mortgage Settlement
Housing settlement details filed in court - Mar. 12
HUD Secretary Shaun Donovan led the $26 billion mortgage settlement deal that was filed in court on Monday.
Dylan Ratigan: On the Mortgage Settlement: There Is No Political Solution to a Math Problem
Mortgage settlement could bring billions in relief - Feb. 9
WASHINGTON (CNNMoney) -- In the largest deal to date aimed at addressing the housing meltdown, federal and state officials on Thursday announced a $26 billion foreclosure settlement with five of the largest home lenders.
The Five Things You Need To Know About Today's Foreclosure Settlement
LOS ANGELES, CA - JANUARY 14: Attorney General of California Kamala Harris speaks onstage at the Cinema For Peace event benefitting J/P Haitian Relief Organization in Los Angeles held at Montage Hotel on January 14, 2012 in Los Angeles, California.
Huzzah, we finally have a massive mortgage-foreclosure settlement !
Mark Gongloff: National Mortgage Settlement By The Numbers
FAQ: The foreclosure settlement
The Obama administration has announced this morning a $26 billion fraud settlement with five of the nation’s banks over their flawed and fraudulent foreclosure practices Here’s what you need to know about it: New York Attorney General Eric Schneiderman, accompanied by Attorney General Eric Holder, speaks at the Justice Department in Washington, Friday,Jan. 27, 2012, after Holder announced the formation of the Residential Mortgage-Backed Securities Working Group.
"So are they off the hook entirely? No. One reason the deal is relatively small is that it doesn’t fully end the banks’ legal liability. New York AG Eric Schneiderman, for instance, is able to move forward with his lawsuit.
Is this a gamechanger for the housing market? No. The effects of this deal are likely to be rather modest. In terms of direct help for consumers, the aggregate impact will be quite minor." by Feb 9
Foreclosure Settlement Reached: Largest Bank Payout By Far Since Financial Crisis
The government is expected to announce on Thursday a roughly $26 billion deal with some of the nation's largest banks to settle charges of systemic and widespread mortgage fraud, according to multiple sources close to the negotiations. The deal would be the largest payout to date from banks in the wake of the financial crisis.
"Also unclear is how far the agreement can go in helping borrowers who are trying to hold onto their home. In addition to granting principal reduction, the deal would offer struggling homeowners relief by changing the terms, or refinancing, loans. Those dollars amount to a pittance when you consider the millions of homeowners in need of help, Golant said. "If you do the math, that's a few hundred million per state. That's not enough to change anything."
Included in the settlement are new rules designed to reform the policies and practices among the mortgage companies, mainly banks, that manage the loans on a daily basis and assist struggling borrowers.
The states' ability to enforce the deal remains one of the great unknowns"
NOT QOTD: If we make the banks pay too much, we’d have to bail them out… again by Feb 9
"Under the terms of the settlement, the banks would pay $25 billion to participating states. California is reportedly receiving a total of $6 billion to $15 billion in the settlement.
Potentially more significant, the banks would agree to forgive some mortgage debt owed by struggling borrowers through what's called "principal reduction." The remedy is nearly universally hailed by economists on the right and left as a way to revive the ailing housing market and rescue the nation's struggling underwater borrowers: More than 20 percent of mortgage holders in the United States owe more on their loan than their home is worth." by Feb 9
The positive mortgage settlement
"If you’re a bank shareholder breathing a sigh of relief, then, don’t. The only thing you’re protected against, now, is lawsuits over robosigning.
What’s happening here is that the mortgage settlement is at heart largely just encouraging banks to bring their balance sheets closer to reality — which is something they’d have to do sooner or later in any case. Indeed, insofar as principal reductions can increase the value of a mortgage, this deal is actually making banks money, over the long term.
So think of this as that rarest of settlements, one which really is a win for all sides. The attorneys general get a big deal, homeowners who got foreclosed upon get $2,000 apiece, and the banks get to do the kind of principal reductions they probably have wanted to do for a while, but while getting significant immunity from prosecution at the same time." by Feb 9
"The prosecutors & regulators still have the right to investigate other elements that contributed to the housing bubble, like the assembly of risky mortgages into securities that were sold to investors & later soured, as well as insurance & tax fraud.
Officials will also be able to pursue any allegations of criminal wrongdoing. In addition, a lawsuit Mr. Schneiderman filed Friday against MERS, an electronic mortgage registry responsible for much of the robo-signing that has marred the foreclosure process nationwide, & 3 banks, Bank of America, JPMorgan Chase and Wells Fargo, will also go forward.
Along with how broad the releases would be, California’s attorney general, Kamala Harris, also pushed for her state to be able to use the state’s False Claims Act. That would enable state officials & huge pension funds like Calpers to collect sizable monetary damages from the banks if officials could prove mortgages were improperly packaged into securities that later dropped in value." by Feb 9
Yves Smith: The Top 12 Reasons Why You Should Hate the Mortgage Settlement
As readers likely know by now, 49 of 50 states have agreed to join the so-called mortgage settlement, with Oklahoma the lone refusenik.