FHFA Files with Court Considering BofA Proposal to Mortgage Investors

The ""Federal Housing Finance Agency"":http://www.fhfa.gov (FHFA) is the second regulatory body to file a petition with the New York federal court that is reviewing ""Bank of America's"":http://www.bankofamerica.com $8.5 billion settlement proposal to Countrywide mortgage investors.

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On Tuesday, FHFA filed a _Notice of Appearance and Conditional Objection_ with the Manhattan court in order to obtain any additional pertinent information that has developed in relation to the matter, according to a statement from the agency.

FHFA says it ""is aware of no basis upon which it would raise a substantive objection to the proposed settlement at this time.""

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In fact, the conservator of ""Fannie Mae"":http://www.fanniemae.com and ""Freddie Mac"":http://www.freddiemac.com says it ""considers it positive"" that the proposed settlement includes subservicing requirements, specific terms for the servicing of troubled mortgages, and the curing of certain document deficiencies.

The federal agency said it is also ""encouraged that a number of significant market participants support the proposed settlement.""

But because of its duty to preserve and conserve the assets of the GSEs, FHFA ""believes it prudent not only to receive additional information as it continues its due diligence of the proposed settlement, but also to reserve its capability to voice a substantive objection in the unlikely event that necessity should arise,"" the agency said.

The FDIC recorded a _Notice of Intention to Appear and Object_ with the Manhattan ""court on Monday"":http://dsnews.comarticles/fdic-sides-with-investors-against-bofas-85b-settlement-proposal-2011-08-29, also stating that it has not been provided enough information to fully evaluate BofA's proposal.

The FDIC was appointed receiver of several failed banks that held certificates issued by the trusts covered under the proposed settlement and now owns those securities.

An agency spokesperson told _Bloomberg News_ that the filing should not be viewed as an opinion on the settlement itself, but is simply a tactic to preserve the FDIC's rights as a participating party and collect additional information.