Regulators Order Banks to Repay Homeowners
(Chicago Sun Times) — If there’s a message to the megabanks in the federal government’s crackdown on mortgage practices, it’s this: Act like a small bank. Personal attention and a little mercy, qualities borrowers often associate with community banks, were on the minds of federal regulators Wednesday as they ordered 16 of the nation’s largest mortgage lenders and servicers to get their own houses in order. The settlements call for future fines against the lenders and payments to homeowners who were wrongly foreclosed upon. But they left unsettled the rules for those payments and so drew criticism from housing activists and Democrats in Congress. They also do not require banks to reduce principal balances for desperate borrowers.