Tag Archives: Bank of America

Bank of America says it is looking to downsize its mortgage servicing portfolio. Company executives told investors Tuesday that they will become more discriminating when adding mortgage servicing rights (MSRs) to their books and will be focused on selling off MSRs more aggressively. The company made roughly $70 million from MSR sales during the second quarter of this year, but on the whole posted its largest-ever three month loss - $8.8 billion - as a result of heavy losses within the consumer real estate services division.

A group of mortgage-bond investors has filed a petition with the New York Supreme Court requesting to be cut loose from the $8.5 billion settlement proposed last week by Bank of America. The settlement would resolve nearly all of the lender's repurchase exposure stemming from legacy first-lien residential mortgage bonds issued by Countrywide. Eleven of the companies to be compensated by the arrangement, though, say BofA's proposal is ""inadequate.""

Fitch Ratings expects that Bank of America's recently proposed settlement for mortgage repurchase and servicing claims will positively affect the ratings of approximately 10 percent of Fitch-rated U.S. residential mortgage-backed securities (RMBS) in the affected Countrywide trusts. In addition, the ratings agency says payouts from the settlement in the short term and improved servicing practices over the longer term are likely to further improve recovery prospects for a larger portion of bonds.

Wells Fargo and Bank of America recently joined Fannie Mae, HUD, and JP Morgan Chase as revitalization and demolition partners to the Cleveland-based Cuyahoga Land Bank, which works to alleviate foreclosure and home abandonment in Cuyahoga County. Both lenders plan to donate vacant and foreclosed low-asset properties to the land bank with monetary contributions for demolition costs to help eliminate neighborhood blight and increase local property values.

Bank of America will pay investors $8.5 billion to compensate them for Countrywide's dealings years before the subprime lender was acquired by BofA. The settlement resolves nearly all of BofA's first-lien repurchase exposure from Countrywide-issued bonds. It involves 530 trusts and $424 billion in securities. The company has also agreed to implement certain servicing changes, which will cost some $400 million. BofA says the cleanup will leave it with a loss for the second quarter, but the market has responded positively to the news.

Servicer reaction varied following Treasury's announcement that it will not pay incentives to three program participants until officials see improvements in the way they handle borrowers under the Home Affordable Modification Program (HAMP). Bank of America ""acknowledged improvements must be made,"" while Wells Fargo said it is ""formally disputing"" Treasury's assessment. Treasury insists its goal is to improve behavior, but some say the move could induce at least one of the larger banks to withdraw from the program.

The U.S. Treasury has released its regular monthly report card on the Home Affordable Modification Program (HAMP). New this time is an assessment of how the 10 largest HAMP servicers are performing. Four servicers have been designated as needing ""substantial"" improvement: Bank of America, JPMorgan Chase, Ocwen Loan Servicing, and Wells Fargo. Treasury says it will withhold financial incentives from three of these companies until they make identified improvements.

The Justice Department announced a settlement with Bank of America and Saxon Mortgage to resolve allegations that the companies wrongfully foreclosed on active duty service members without obtaining court orders, a violation of the Servicemembers Civil Relief Act (SCRA). The combined settlements represent more than $22 million in monetary victim relief. Both companies have also agreed to repair negative credit reporting related to the foreclosures and will not pursue remaining amounts owed under the mortgages.

Bank of America will leverage the federal government's Hardest Hit Fund (HHF) through participation in unemployment assistance programs in all 18 eligible states and the District of Columbia. The HHF targets states with sustained unemployment rates at or above the national average and falling property values. Collectively, state housing finance agencies have about 2,700 applications for unemployment assistance in process for BofA customers and have provided $2.8 million toward mortgage payments for the benefit of more than 700 customers.

Las Vegas residents facing foreclosure can receive help during a Home Rescue Fair this Friday and Saturday at the Palace Station Hotel Casino. Sponsored by the city of Las Vegas, the event was organized by Housing for Nevada and the Alliance for Stabilizing Communities, with the support of Bank of America.