The foreclosure settlement draft reached the final stage
The first announcement came from HUD Secretary Shaun Donovan, who said last week that the state attorneys general are ready to sign the settlement with the nation’s largest servicers in just a few week.
Now DsNews reports that a spokesperson for Iowa Attorney General Tom Miller’s office is corroborating the claim, saying that the settlement draft is already available and it is in the hands of the AGs for review.
The Associated Press came out with an update yesterday stating that the settlement terms require as much as $25 billion from the 14 banks participating in the settlement.
The draft also lays down the number of distressed homeowners who will receive about $1,800: 750,000 individuals will be the lucky ones to get this amount from the banks.
Another important point of the settlement is that 1 million homeowners may receive principal reductions.
Although there were rumors suggesting President Barack Obama will announce the successful settlement during his State of the Union today, Miller stated yesterday that the committee did not reach an agreement with five of the nation’s largest servicers, so it will be no official settlement announcement anytime this week.
The more the settlement terms get known, and get wider publicity the more concerns are expressed even among officials: last week Ohio AG Sherrod Brown expressed his concerns the proposed settlement may be too easy on banks.
“A settlement must provide meaningful, widespread relief to Ohio homeowners. Unfortunately, the numbers reported in various media accounts fail to meet this test,” Sherrod wrote. “The proposed principal reduction program must focus on banks settling with their own money, rather than shifting their financial liability to Private Label Securities (PLS) trusts,” he added.
Reuters reported that Brown reiterated his concerns Monday .“Instead of criminal prosecutions, we are talking about not much more than a slap on the wrist,” Brown said. “In many ways, Wall Street isn’t just too big to fail, it’s also too big to jail.”