Bank of America ahead of settlement deadline

Bank of America has successfully fulfilled 63% of it $7bn promise of consumer relief required following its settlement with the US Department of Justice. The bank is set to complete its consumer-relief obligations ahead of its August 2018 deadline, which were acquired following claims of the sale of toxic residential mortgage-backed securities. Bank of America is expected to submit substantial claims for customer relief in the next few quarters, providing additional relief to homeowners and communities suffering financial stress.

Bank of America is on track and nearly two-thirds of the way done on fulfilling its $7 billion promise of consumer relief required as part of its $16.65 billion settlement with the U.S. Department of Justice, certain federal agencies and six states to resolve claims over toxic residential mortgage-backed securities, collateralized debt obligations and an origination release on residential mortgage loans sold to Fannie Mae and Freddie Mac.

According to a the newest report from Eric Green, the independent monitor of the settlement agreement, he conditionally approved $294,987,938 worth of credit for consumer relief for the fourth quarter of 2015.

The cumulative amount of conditionally-approved credit now totals $4,439,940,939, or 63% of the required $7 billion of credited consumer relief.

“The monitor’s latest report again demonstrates we have extended meaningful relief to homeowners suffering financial stress, mortgages for low- and moderate-income homebuyers and communities, and assistance for communities that are dealing with the impacts of foreclosures and abandoned properties. We continue working hard to ensure customers in need of assistance are treated fairly and receive timely and accurate decisions with respect to relief they are seeking,” said Bank of America spokesperson Richard Simon.

At its current pace, Green said, “Bank of America appears likely to fulfill its consumer-relief obligations well ahead of the August 2018 deadline.

“Although the consumer relief claimed by Bank of America for this quarter is relatively modest compared to other quarters,” he said, “I am informed that Bank of America intends to submit substantial claims for credit in the coming quarters for additional modifications of homeowners’ mortgages.”

“The monitor has reviewed and certified more than $4.4 billion of credited consumer relief in line with the bank’s submission of activity completed through the fourth quarter of 2015. These activities have benefitted thousands of mortgage customers through principal forgiveness and lending to lower-income borrowers, as well as communities and non-profit organizations. With the completion of subsequent relief measures not yet reviewed for crediting, we are well on our way to fulfilling our total commitment of $7 billion in credited relief well ahead of the four-year deadline,” Simon added.

The report noted that of the $294,987,938 of requested credit that the bank submitted for the fourth quarter of 2015, more than $244 million, or 83%, was for modifications to an additional 5,172 loans. Nearly $46 million was for new loans extended to 4,496 low- and moderate-income first-time homebuyers, borrowers in Hardest Hit Areas, or borrowers who lost their homes to foreclosures or short sales. Another $4.76 million was for an additional subordinated loan to facilitate affordable housing.

Back in November, the monitor reported that Bank of America is nearing the halfway point in delivering on its $7 billion promise of consumer relief.