Categorized | Commercial

Bank of America Settling Toxic Mortgages

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Bank of America which had exposure to a large percentage of toxic mortgages has come out with a plan to get rid of those toxic mortgages by selling it out. Bank of America has set aside $20 billion for getting rid of those mortgages. It has made a settlement with some of its famous investors such as the black rock and the Goldmansachs. Out of this $20 billion, it’s planning to spend $8.5 billion on the mortgages bought by their high profile investors. Bank of America Settling Toxic Mortgages only to benefit their high profile investors has not gone down well with their ordinary retail customers.

Bank of America was extremely comfortable with the transaction until New York Attorney General Eric Schneider man got into the act. He had sent letters to those 22 firms that has been part of the settlement. He has also pointed out that there will be a thorough investigation into the nature of the transaction entered in to by Bank of America. He is of the opinion that both the ordinary retail investors and also the borrowers will get affected by this transaction. Some borrowers will be forced to speed up their foreclosure process. . Bank of America Settling Toxic Mortgages has not gone down well with the New York state administration.

Bank of America on the other hand says that this transaction will only benefit the borrowers and they will get more flexibility in making their interest payments. But some the experts feel that the mortgage service providers have long promised to do things differently, but still have not yet started. One investor is going one step further and is planning to sue the BOA for getting into a secret deal with the settlement’s negotiator. Bank of America Settling Toxic Mortgages has opened a Pandora’s Box and many more skeletons might start falling from the cupboard.

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About Drew Wilson

Drew focuses on the Commercial and Mortgage/Finance categories.

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