Every week I receive an economic update from Jeff Collins, a residential mortgage lender at First International Bank in Jackson, WY. His cautionary nature has provided more education of a new deal made by the Obama administration last Thursday.
As you may have already heard, five of US banks who practiced abusive mortgage practices have “agreed” to a settlement of $25 billion to help an estimated one million borrowers.
The deal only dedicates $1.5 billion of the 25 to compensate borrowers about $2,000 for those who lost homes due to foreclosure. While some feel that the deal stinks, others feel that it’s a step in the right direction.
Probably the most disappointing part of this news is to know that banks couldn’t be happier with the deal as reported by the NY Times. Many still have the opinion that thebanks have still gotten away with lending on a property, repossessing the property, then selling it again as a “bank-owned” property, aka an REO