10 banks to pay $8.5 bln to end foreclosure reviews

WASHINGTON Mon Jan 7, 2013 11:02am EST

WASHINGTON Jan 7 (Reuters) - Ten mortgage servicers agreed on Monday to pay $8.5 billion to end a case-by-case review of foreclosures required by U.S. regulators.

Banks including Bank of America, Citigroup, JPMorgan, Wells Fargo and six others will pay $3.3 billion directly to eligible homeowners, and will also pay $5.2 billion in loan modifications and forgiveness, regulators said.

The Office of the Comptroller of the Currency and the Federal Reserve Board said they accepted the agreement to get relief to consumers more quickly than through the reviews.

In April 2011 the agencies required the servicers to review foreclosure actions from 2009 and 2010 to evaluate whether borrowers had been unlawfully foreclosed on or otherwise suffered financial harm due to errors in the foreclosure process.

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