Big banks OK mortgage relief
WASHINGTON — Five of the biggest U.S. banks have cut struggling homeowners' mortgage balances by $19 billion, part of a total $45.8 billion in relief provided under a landmark settlement over foreclosure abuses.
More than 550,000 borrowers received some form of mortgage relief between March 1 and Dec. 31, 2012, according to a report issued Thursday by Joseph Smith, the monitor of the settlement.
That translates to about $82,668 per homeowner, according to the report, which is based on the banks' own accounts. Smith said he must confirm the banks' data before they can get credit.
The deal was struck a year ago by the federal government and 49 states with the five largest U.S. mortgage servicers: Bank of America Corp., JPMorgan Chase & Co., Citigroup Inc., Wells Fargo & Co. and Ally Financial Inc. The five agreed to reduce balances on mortgages where the borrower owes more than the home is worth and to refinance some loans.
The agreement reduces mortgage debt for only a fraction of those whose mortgages are underwater.