Tag Archives: Bank of America

A federal judge has ruled to allow the Delaware and New York attorneys general to pursue litigation in Bank of America's $8.5 billion settlement with mortgage investors. Bank of America reached the settlement agreement in June with Bank of New York Mellon, the trustee for the 530 mortgage-backed securities trusts in question. But the judge has ruled that there's more at stake than the financial interests of the few major investors involved in the settlement negotiations.

The third quarter of 2011 saw a net increase of 2,738 mortgage-related jobs, according to recent industry data. This increase is the first recorded in five quarters. The recent increase in refinances encouraged by remarkably low interest rates sparked a demand for loan originators and processors, while continuing high levels of delinquencies and foreclosures bolstered the need for servicing staff. The 2,738 gain compares to a net loss of 464 jobs in the previous quarter and a loss of 936 jobs a year ago.

State attorneys general and the nation's five largest mortgage servicers could be within weeks of reaching a $25 billion agreement to settle allegations that foreclosures were improperly processed. Details of the settlement terms obtained by DSNews.com indicate that individual servicer penalties will be based on the number of foreclosures they've completed. Collectively, $5 billion would come in the form of cash fines and $20 billion would be satisfied with principal-reducing modifications and refinancing for underwater borrowers.

The industry's four largest mortgage servicers all say they will be taking part in the revamped Home Affordable Refinance Program (HARP). Bank of America, Chase, Citigroup, and Wells Fargo have each expressed their support of the program and the changes that will allow more underwater homeowners to refinance. Government officials expect the program's revisions to expand its reach and increase competition for mortgage refinancing, with an estimated 1 million homeowners to receive assistance under the new guidelines.

Investors opposed to the $8.5 billion settlement reached between Bank of America and securities trustee Bank of New York Mellon will get their day in federal court. The settlement was originally filed in New York state court. A band of dissenting investors going by the name of Walnut Place moved the action to federal court, and BNY Mellon has been pushing for the case to revert back to the state. U.S. District Judge William Pauley denied BNY Mellon's motion this week.

Bank of America reported Tuesday that it saw a profit of $6.2 billion during the third quarter of this year, compared to a loss of $7.3 billion a year ago. Perhaps the biggest headline-grabber gleaned from BofA's third-quarter numbers is that the company lost its position as the largest U.S. bank by assets. On the mortgage side of the business, BofA says it has successfully implemented the rollout of a single point of contact for default servicing. Provisions for credit losses declined 37 percent from the year-ago quarter.

Help for underwater homeowners has moved from principal writedowns to refinancing in the settlement negotiations between state attorneys general and the nation's five largest mortgage servicers. According to a widely circulated report, the proposal made its way into the talks last week. Borrowers who are current on their mortgage payments but owe more than their home is worth would be able to refinance at today's lower rates. The main caveat is that the loan must be owned, not just serviced, by one of the five banks.

Amid a challenging environment for servicers, CitiMortgage, GMAC, and Ocwen have outperformed major competitors with regards to loss mitigation and foreclosure timelines, according to a recent report from Moody's Investors Service. The company's Servicer Dashboard rates major servicers on their performance from June 2010 to June 2011. Moody's notes that Bank of America's and Chase's performance assessments were affected by large servicing acquisitions and foreclosure moratoria.

Bank of America has begun a pilot program in Florida offering extra incentive payouts to distressed homeowners who agree to and successfully close on a short sale. Incentive payments for relocation assistance range between $5,000 and $20,000. The program is being offered on a limited basis for investor-approved, pre-offer short sales. Bank of America is calling it a pilot ""test-and-learn"" program, and if successful in Florida, it could be expanded to other states.

A former Countrywide employee is now behind bars and being forced to pay $1.2 million in restitution for stealing and dispersing confidential customer information, including social security numbers. A U.S. district judge sentenced 39-year-old Pasadena resident Rene Rebollo to eight months in prison and 10 months in a community corrections facility. Rebollo, who served as a senior financial analyst in Countrywide's subprime mortgage division, pled guilty to the charges.