The Real Deal Miami

Banks paid $9B to Florida mortgage holders

Around 92,000 homeowners received money as part of state and federal agreement
May 22, 2014 05:15PM

Five national banks indicated today that they have finished paying $9.1 billion to Florida homeowners are part of a settlement with the state and federal officials. 

Some of the $9.1 billion in relief came directly from a $26 billion settlement program between the federal government and five of the country’s largest mortgage servicers. The money was divided among 92,000 Floridians.

The national settlement, signed in 2012, involved Bank of America N.A., JPMorgan Chase & Co., Citibank, Ally Bank and Wells Fargo Bank N.A. The five were charged by state and federal investigators with breaking the law by signing foreclosure documents outside the presence of a notary public. The investigators also charged that key information in the documents was often not verified or double checked.

A separate deal was negotiated between Florida and Bank of America, Wells Fargo and JPMorgan Chase. The three banks ended up paying around $4 billion in relief to homeowners in the state.

“The guarantee we separately negotiated with the three largest servicers in Florida was crucial to ensuring that the servicers focused their efforts in Florida, one of the states hardest hit by the mortgage crisis,” said Attorney General Pam Bondi.

According to the Daily Business Review, Bank of America, Chase and Wells Fargo provided $5.22 billion, $2.48 billion and $1.42 billion to homeowners respectively. About 49 percent was from writedowns on first and second mortgages. Another 15 percent was for refinancing, and 35 percent provided other relief. [Daily Business Review] Claire Moses