Banks Reach $8.5 Billion Settlement With Regulators Over Foreclosure Abuses

Federal regulators and 10 of the nation’s biggest banks have reached an $8.5 billion settlement over the banks’ foreclosure abuses in the wake of the housing crisis. The banks involved in the settlement include Wells Fargo, the nation’s largest mortgage servicer, as well as Bank of America, J.P. Morgan Chase, Citigroup, and six other banks. According to terms of the settlement, the banks will pay $3.3 billion directly to homeowners and will direct $5.2 billion to loan modifications and forgiveness. In February 2012, five of the largest banks reached a $25 billion foreclosure fraud settlement with the federal government and state attorneys general.