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Bank of America to Pay Freddie Mac $404 Million

sentinelsource.com | December 9, 2013

By Rick Rothacker

CHARLOTTE, N.C. — Bank of America Corp. on Dec. 2, said it will pay Freddie Mac $404 million to settle remaining claims over soured home loans the bank sold to the mortgage giant, marking the bank’s latest attempt to put its mortgage woes behind it.

The Charlotte-based bank said the agreement resolves all requests to buy back defective mortgages sold to Freddie from Jan. 1, 2000, to Dec. 31, 2009. Bank of America said the cost of the settlement is covered by the bank’s existing reserves.

It’s the latest settlement Bank of America has reached with government-controlled Freddie, which like its sister institution, Fannie Mae, buys home loans from lenders and packages them into mortgage-backed securities. In the aftermath of the housing crash, Fannie and Freddie, which were taken over by the U.S. government in 2008, have asked banks to buy back or reimburse losses related to mortgages that went bad or did not meet agreed-upon requirements.

Bank of America has reached a previous agreement with Freddie over loans sold by Countrywide Financial Corp. through 2008 and forged two settlements with Fannie over Countrywide and Bank of America loans sold through 2008. Bank of America acquired Countrywide in 2008.

At the end of September, Bank of America had $1.4 billion in outstanding mortgage repurchase requests from Freddie, the most of any bank, according to Freddie’s quarterly securities filing in November.

The latest agreement does not cover loan servicing obligations, loans packaged into bonds by other securitizers and disclosure-related claims, the bank said. The Wall Street Journal reported last month that Bank of America was in talks to reach a settlement with Freddie.


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CFLA was founded by the Nation's Leading Foreclosure Defense Attorneys back in 2007 to serve the Foreclosure Defense Industry and fight pervasive Bank Fraud. Since opening our virtual doors, CFLA has rapidly expanded to become the premier online legal destination for small businesses and consumers. But as the company continues to grow, we're careful to hold true to our original vision. For us, putting the law within reach of millions of people is more than just a novel idea—it's the founding principle, just ask Andrew P. Lehman, J.D.. With convenient locations in Houston and Los Angeles, you can contact Our National Account Specialist and General Manager / Member Damion W. Emholtz at 888-758-2352 for a free Mortgage Fraud Analysis or to obtain samples of work product, including cutting edge Bloomberg Securitization Audits, Litigation Support, Quiet Title Packages, and for more information about our Nationally Accredited and U.S. Department of Education Approved "Mortgage Securitization Analyst Training Certification" Classes (3 days) 24 hours for approved CLE & MCLE Credit (Now Available Online).

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