November 16, 2010 / 5:08 AM / 7 years ago

Banks, state AGs near foreclosure settlement: report

NEW YORK (Reuters) - U.S. banks and a task force of the nation’s 50 state attorneys general are nearing a settlement of an investigation into the lending industry’s foreclosure practices, CNBC said on Tuesday.

A settlement would call for Bank of America Corp, JPMorgan Chase & Co and others to contribute money to a fund to assist borrowers who lost their homes to foreclosure and which would be administered by the regulators, CNBC said.

It would also involve a promise by banks to do away with “dual-track” modifications and foreclosures, a much-criticized practice in which they begin foreclosure proceedings before exhausting attempts to modify home loans, CNBC said.

The task force is being led by Tom Miller, the attorney general of Iowa. A settlement might not be reached for at least one month, CNBC said.

Mortgage lenders have received much criticism for employing “robo-signers” who sign hundreds of foreclosure documents at a time without knowing or understanding their contents.

Miller, Bank of America and JPMorgan did not immediately return calls seeking comment.

Reporting by Jonathan Stempel and Jonathan Spicer in New York; editing by Andre Grenon

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