Political Push Moves a Deal on Mortgages Inches Closer

[ProSense]

Political Push Moves a Deal on Mortgages Inches Closer

By NELSON D. SCHWARTZ

<...>

But a final agreement remained out of reach Monday despite political pressure from the White House, which had been trying to have a deal in hand that President Obama could highlight in his State of the Union address Tuesday night.

<...>

Tom Miller, the attorney general of Iowa, said Monday that an agreement with the nation’s five largest mortgage servicers — Bank of America, JPMorgan Chase, Citigroup, Wells Fargo and Ally Financial — would not be reached “anytime this week.”

<...>

In addition to disagreements over the total amount, negotiations have been held up over the question of how much latitude authorities would have in pursuing investigations into mortgage abuses before the housing bubble burst in 2007. The banks are pushing for a broad release from future claims, but several attorneys general, including prominent figures like Eric Schneiderman of New York and Martha Coakley of Massachusetts, have demanded a tougher line on the banks.

<...>

This month, about 15 Democratic attorneys general who shared concerns about the course of the settlement talks met in Washington, including Ms. Coakley, Mr. Schneiderman, Catherine Cortez Masto of Nevada and Beau Biden of Delaware, who is a son of Vice President Joseph R. Biden Jr.

- more -

http://www.nytimes.com/2012/01/24/business/a-deal-on-foreclosures-inches-closer.html?_r=1&pagewanted=all

[zipplewrath]

1. Let's hope

Both federal and state officials emphasized that the liability for past practices remained at the heart of the delay, rather than the size of the monetary penalties and other payments. In addition, they noted that no release from criminal violations was being discussed, only civil actions.

I suspect we should be asking for more cash, but it is more important for the criminal violations to still be open to prosecution.

The proposed settlement is “not going to be enough,” said Kathleen C. Engel, a law professor and a co-author of “The Subprime Virus.” She added that the deal was at least as good for the banks as for homeowners, if not better. “They could be hit with 50 different lawsuits from each of the states, for a lot more money,” she said.

At the end of the day, I don't suspect there will ever be the policital will to go after all the money the banks owe.

[ProSense]

2. Well

so much for the rumors. It doesn't appear a settlement is going to be announced this week.

[Enrique]

3. thanks to the holdouts

may they keep holding out.

[zipplewrath]

4. The new tidbit

The new tidbit here is that the claim that both the feds and the states are not negotiating away the criminal liability, only civil penalties. I'm surprised the banks would go for this actually.

But I agree, they seem to be talking about a February announcement. And that presumes the AG's actually end up agreeing.

[TBF]

6. I'm surprised as well - but glad that criminal liability is still on the table. nt

[ProSense]

7. True,

we'll see.

[Scurrilous]

5. Thanks ProSense.