Flagstar Bancorp reaches $10.8 million repurchase settlement
Follows wave of Fannie, Freddie settlements
Flagstar Bancorp (FBC), the holding company for Flagstar Bank, has entered into an agreement with Freddie Mac to resolve substantially all of the repurchase requests and obligations associated with loans originated between Jan. 1, 2000, and Dec. 31, 2008, reaching a total amount of $10.8 million, the company announced in a press release.
However, after paid claims and other adjustments, the bank will make a $8.9 million payment to Freddie Mac, which the bank’s representation and warranty reserve is sufficient enough to cover.
"This agreement is another positive step for Flagstar in further reducing the company's risk profile while supporting improved performance," said Alessandro DiNello, Flagstar's president and CEO.
"We believe that our accomplishments in 2013 have positioned Flagstar for sustainable long-term growth in 2014 and beyond," DiNello added.
This agreement comes shortly after the firm reached a settlement with Fannie Mae at the beginning of November to resolve repurchase claims, for a total resolution amount of $121.5 million.
The government-sponsored enterprises are pushing to resolve most of their outstanding repurchase settlements by the end of year. Fannie Mae also reported a major settlement with Wells Fargo (WFC) Monday morning.