BANK OF AMERICA SETTLES TOXIC MORTGAGE CLAIMS FOR RECORD $16 BILLION

BANK OF AMERICA ANNOUNCED THURSDAY THAT IT HAS AGREED TO SETTLE AND $16 BILLION FOR ALL THE TROUBLE IT CAUSED IN THE MORTGAGE FINANCIAL CRISIS.  THE SETTLEMENT IS THE LARGEST CIVIL SETTLEMENT WITH A SINGLE ENTITY IN THE HISTORY OF THE UNITED STATES.  SOURCE:  DS NEWS

ACCORDING TO THE SETTLEMENT, BANK OF AMERICA HAS AGREED TO PAY $9.65 BILLION IN CASH TO THE JUSTICE DEPARTMENT, VARIOUS FEDERAL REGULATORS, AND THE STATES OF CALIFORNIA, DELAWARE, ILLINOIS, KENTUCKY, MARYLAND AND NEW YORK.

THE REMAINING $7.0 BILLION WILL BE PAID IN THE FORM OF CONSUMER RELIEF INCLUDING MORTGAGE MODIFICATIONS, COMMUNITY STABILIZATION, AND LOANS TO LOW AND MODERATE INVOME COMMUNITIES.

THE AGREEMENT RELEASES BANK OF AMERICA FROM ALLEGATIONS THAT IT WAS INVOLVED IN THE MORTGAGE FINANCIAL CRISIS, THAT IT WAS AWARE THAT THE LOANS IT GAVE WERE BAD AND THAT IT KNOWINGLY MISREPRESENTED MORTGAGES WHEN THEY WERE SOLD. IT ALSO RELEASES THE LENDER FROM VIOLATONS OF UNDERWRITING GUIDELINES MADE BEFORE THE MORTGAGE CRISIS.

IN A STATEMENT, BANK OF AMERICA ANNOUNCED THAT THE MAJORITY OF THE CLAIMS STEMMED FROM CONDUCT THAT OCCURRED AT COUNTRYWIDE AND MERRILL LYNCH BEFORE ITS ACQUISITION OF THE TWO COMPANIES.

WHILE CERTAINLY A BANDAID IN THE WHOLE MORTGAGE FIASCO, THIS SETTLEMENT IS GOOD NEWS FOR CONSUMERS WHO ARE LOOKING TO BANK OF AMERICA FOR LOAN MODIFICATIONS AND SHORT SALES. IT MEANS THAT BANK OF AMERICA WILL MOST LIKELY COOPERATE TO THE FULL EXTENT IN ORDER TO HAVE SUCH OPTIONS APPROVED.

IF BANK OF AMERICA IS YOUR LENDER, CALL US TODAY TO DISCUSS HOW THIS SETTLEMENT AFFECTS YOU. THE FIRST CONSULT IS ALWAYS FREE OF CHARGE.

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