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Bank Of America Has Provided No Mortgage Principal Relief Under The Foreclosure Fraud Settlement

By Pat Garofalo on August 29, 2012 at 5:30 pm

"Bank Of America Has Provided No Mortgage Principal Relief Under The Foreclosure Fraud Settlement"

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The nation’s five biggest banks agreed to a $25 billion foreclosure fraud settlement back in February that required them to provide $17 billion of mortgage relief to troubled homeowners. However, one of the banks, Bank of America, is hardly holding up its end of the bargain. According to a new report, as of June 30, Bank of America had not modified a single mortgage under the settlement to reduce the amount that a borrower owes:

Bank of America Corp is lagging other banks in quickly executing mortgage modifications required by the U.S. government as part of the $25 billion foreclosure settlement finalized in March, according to a report released on Wednesday…Unlike its competitors, Bank of America did not finalize any modifications of first-lien mortgages and also did not complete any refinances by June 30.

Bank of America admitted earlier this month that it was lagging behind on loan modifications, but this report shows just how incompetent the bank has been when it comes to moving homeowners into more sustainable mortgages. Bank of America does lead the settlement banks affected in getting its borrowers through short sales, but as Firedoglake’s David Dayen explained, “the idea of banks granting short sales as a punishment for defrauding consumers and state courts is ridiculous. They’re all too happy to get a higher price for a short sale than they would get in foreclosure, with the added benefit of never having to take the foreclosed home and maintain it.”

Prior to the settlement, one whistleblower alleged that Bank of America intentionally blocked homeowners from receiving federal mortgage aid. But perhaps all these homeowners simply weren’t willing to erase the mean things they said about Bank of America on Twitter.

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