U.S. finance giant Bank of America said Monday it would pay $404 million to settle all claims brought by the Federal Home Loan Mortgage Corp.
The bank said the settlement, which includes a credit of $13 million for mortgages the bank has already repurchased, would resolve claims on mortgages sold to Freddie Mac between Jan. 1, 2000, and Dec. 31, 2009.
The bank also said it had the settlement covered by funds already placed in reserve.
With the settlement, the bank said it had put to rest all claims on loans that were sold before the financial crisis to Freddie Mac and Fannie Mae by either Bank of America or Countrywide Financial Corp., which Bank of America bought in 2008.
The loans were sold as solid investment, although many were risky, subprime loans that soured in part because financial firms lowering their standards as they rushed to write more loans.
Freddie Mac and Fannie Mae, the country's largest mortgage brokers, were bailed out by the federal government in 2008 due to the large number of failing loans.
Copyright 2013 United Press International, Inc. (UPI). Any reproduction, republication, redistribution and/or modification of any UPI content is expressly prohibited without UPI's prior written consent.
Original headline: BofA settles loan claims with Freddie Mac for $404 million
Most Popular Stories
- Fed Committee Optimistic About Growth Prospects
- U.S. Immigration Courts Facing Record Backlog
- Drive-In Movie Theaters Use Creativity to Afford Digital Switch
- Obama Cites Letter Writers in Pitching Economy
- Stevie Fielder Changes Tune on Thad Cochran Vote-buying Story
- Pau Gasol Turns Down Lakers' Offer
- Pot's Legal in WA -- But You Should Probably Ask Your Boss
- How ESPN Became a $50B Sports Empire
- Farrell, Kitsch Rumored for Season 2 of 'True Detective'
- President Obama Relishes Roadshow, but Agenda Still Stuck