According to The Wall Street Journal, Bank of America (BAC) has reached an agreement to pay $17 billion to resolve claims over the toxic residential mortgage-backed securities the lender issued prior to the financial crisis.

Bank of America had no comment as of press time.

The WSJ reports that the bank will reportedly pay the $17 million in a combination of cash and consumer relief.

If true, the $17 billion settlement would exceed the previous high of $13 billion paid by JPMorgan Chase (JPM) in November to settle similar claims.

The U.S. Department of Justice then used some of that money to speed up its cases against other big banks, like Bank of America and Citigroup (C).

Last month, Citi officially announced a $7 billion dollar settlement with the U.S. Department of Justice, several state attorneys general, and the Federal Deposit Insurance Corporation to settle residential mortgage-backed securities and collateralized debt obligations after industry whispers that the bank was nearing a resolution.

BofA took a little longer, as the New York Times said the bank was at an impasse in negotiating a multi-billion dollar settlement deal related to the bank’s involvement in the mortgage crisis.

Now, according to multiple reports citing people close to the deal who were not authorized to speak about the settlement, BofA will finally settle for a record amount.

In early August, the Housing Finance Policy Center staff at the Urban Institute said that there were several steps the bank could do take ensure a positive result from the settlement.

“Our analyses of earlier settlements reveal several lessons, including these five strategies that should be considered by the current parties to ensure a more successful outcome for consumers, communities, and investors,” the staff at housing center said at the time.

The Urban Institute named five specific steps the bank should take:

  1. Harness the power of incentives. As we learned from the 2012 National Mortgage Settlement (NMS), well-constructed rules can shape bank behavior. By providing more credit for preferred actions such as principal reduction, the settlement could create better outcomes for communities and individuals.
  2. Give clear and substantial credit for real estate owned (REO) donations and other community-based activities. The NMS resulted in a disappointing number of REO donations, a type of consumer relief that can be incredibly beneficial to communities. By clarifying that REO donations are a preferred type of relief, the settlement could do more for communities.
  3. Give less credit for second liens. Conversely, the NMS saw a huge number of low quality second-lien modifications, due to strong incentives. Less credit for this type of modification could move the focus from easy write-offs to those with greater impact.
  4. Set limits on the use of other people’s money. Mortgages serviced for investors are viable candidates for modification when it is beneficial to consumers and fair to investors. Deciding the maximum amount of consumer relief that can be granted upfront with investor funds could help smooth investor concerns. That percent should be published prior to finalizing the settlement, so investor objections can be considered.
  5. Clarify and publicly disclose net present value (NPV) calculations. NPV models used to determine the loans eligible for modification are opaque to investors and the public. Clarifying and disclosing these measurements, and requiring the settlement monitor or similar party to validate that the models are properly applied to investor loans, could further investor satisfaction with this and subsequent settlements.

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