Nelson D. Schwartz
Foreclose Deal Near, State Officials Say
By Nelson D. Schwartz
WASHINGTON — A broad agreement could be struck within two months to overhaul how millions of foreclosures are handled by the nation’s biggest banks and to expand the use of home loan modifications, according to Tom Miller, the attorney general of Iowa.
All 50 state attorneys general, along with federal regulators, have been stepping up pressure on the mortgage servicers over their foreclosure lapses in recent days and presented them with an outline of a settlement late last week. But when Mr. Miller made his comments at a press conference here on Monday, it was the first time officials have said when an agreement might come.
“I’m hoping we can wrap it up in a couple of months,” he said. “That’s a hope, but we’re going to move as fast as we can.”
There have been reports that a broad settlement with the banks was imminent, but Mr. Miller played down that prospect, citing thorny issues like the question of just which homeowners should benefit from the proceeds of any settlement.
The attorneys general and federal government agencies are pressing for a financial settlement that could total over $20 billion. When asked about these estimates, Mr. Miller and three other attorneys general declined to comment on Monday.
While the attorneys general and the newly created Consumer Financial Protection Bureau support such a fund for homeowner relief, there has been growing criticism of the government’s existing program to modify mortgages, known as the Home Affordable Modification Program. Last week, Republicans in the House pushed to kill the program, which has helped far fewer homeowners than promised.
A fund with at least $20 billion would represent a sharp expansion of modification efforts for the more than four million Americans facing the loss of their homes.