The federal government and the governments of 49 of the 50 states (Oklahoma is the exception) have agreed to a $26 billion settlement package with 5 big banks over the banks’ mortgage lending and foreclosure practices. The banks that are included in the settlement are Bank of America Corp. (NYSE: BAC), Citigroup Inc. (NYSE: C), JPMorgan Chase & Co. (NYSE: JPM), Wells Fargo & Co. (NYSE: WFC), and Ally Financial (formerly GMAC).
Of the $26 billion, about $5 billion will go to the states to help them develop foreclosure-prevention programs, the servicers will pay about $3 billion to refinance mortgages at lower interest rates, and about $1.5 billion to homeowners harmed by foreclosure foul-ups. The remaining $17 billion will be used to pay for mortgage debt forgiveness, forbearance, short sales, and other direct payments to homeowners.
California, Nevada, and New York were among the last states to get on board with the settlement.
A website that discusses the details of the settlement and how homeowners can file claims is here.
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