AGs propose second settlement in foreclosure investigation: Reports
The 50 state attorneys general proposed a second settlement offer to major mortgage servicers under investigation for faulty foreclosure practices, according to several reports Tuesday. Both American Banker and Bloomberg reported a second offer was made. Though no details of the proposal were officially given, reports claimed the proposal was weaker than the one before, cutting such requirements as mandatory principal reduction. Several state AG offices declined to comment, while a spokesperson for Florida AG Pam Bondi said no new information was available. Last year, major servicers halted foreclosures to correct affidavits signed en masse and without a proper review of documentation as required by law in some states. The largest servicers signed consent orders in April with the Office of the Comptroller of the Currency and the Federal Reserve pledging to make the corrections to their processes. The 50 AGs and other federal regulators launched their own investigation. After their initial settlement offer, a group of Republican AGs, including Bondi, pushed for a less-stringent crackdown. They claimed excessive terms would spur strategic default among borrowers looking to take advantage of mandatory reductions and modifications. Write to Jon Prior. Follow him on Twitter @JonAPrior.