Attorney General Bondi formally entered a landmark $25 billion joint federal-state agreement with the nation’s five largest mortgage servicers over foreclosure abuses and unacceptable nationwide mortgage servicing practices. The proposed agreement provides an estimated $8.4 billion in relief to Florida homeowners and addresses future mortgage loan servicing practices. The settlement generally releases civil claims related to robo-signing, other foreclosure-related abuses, and loan origination misconduct, but it provides no release of criminal claims or of claims related to mortgage securitization.
“This settlement will provide substantial relief to struggling Florida homeowners, and ensures that our state gets its fair share of the relief being provided nationally,” stated Attorney General Pam Bondi. “This agreement holds banks accountable and puts in place new protections for homeowners in the form of strict mortgage servicing standards.”
Florida’s share of the total monetary benefits under the settlement is approximately $8.4 billion.
- Florida borrowers will receive an estimated $7.6 billion in benefits from loan modifications, including principal reduction, and other direct relief.
- Approximately $170 million will be available for cash payments to Florida borrowers who lost their home to foreclosure from January 1, 2008 through December 31, 2011 and suffered servicing abuse.
- The value of refinanced loans to Florida’s underwater borrowers would be an estimated $309 million.
- The state will receive a direct payment of $334 million.
In addition to the terms of the national settlement agreement, Attorney General Bondi separately negotiated an agreement with the nation’s three largest mortgage servicers to ensure that a guaranteed portion of the overall settlement funds goes to Florida borrowers.