In a deal with the U.S. Justice Department, the Department of Housing and Urban Development, and 49 out of 50 state attorneys, five of the country’s largest lenders have agreed to a $26 billion settlement – that’s more than $5 billion per lender.
Their crime, as nationalmortgagesettlement.com put it, is that “they routinely signed foreclosure related documents outside the presence of a notary public and without really knowing whether the facts they contained were correct.”
Dick Bove, bank analyst for Rochdale Securities, called it “the mortgage deal from hell.”
“Homeowners who made large down payments on their homes or made the terrible mistake to pay down the principal on their mortgages do not qualify,” he said. “Homeowners who made minimal or no down payments will get the windfall benefit of a lower principal repayment or a cash payment.”
If the deal is from hell, the devil must be in the details … except that there are no details, because, as American Banker reported, “a fully authorized, legally binding deal has not been inked yet.”
Yet, as zerohedge.com points out, the settlement agreement appears to have been “robosigned” as well. Keep an eye out for the settlement document on nationalmortgagesettlement.com, which says
it is “coming soon.”
It’s yet another example of “do as I say, not as I do.”
As President Obama said, the settlement is just “a start.” Stay tuned for others.