Home > Avid Law Center > Harris Holds Out For Tougher Terms

Harris Holds Out For Tougher Terms

California Attorney General Kamala Harris is seeking tougher terms in the multi-state proposed agreement with banks over foreclosure practices.

The proposed deal, announced last week, is expected to range from $17 billion to more than $30 billion, depending on how many state attorneys general sign on to it and how many servicers take part in it. If California supports the deal covering the five biggest servicers, a settlement is likely to hit $25 billion but Harris is pushing for a broader probe of banks’ mortgage practices, including securitization of the loans.

According to Bloomberg, some analysts say that this move may be an effort to strengthen her political standing as a rising star in the Democratic Party. By holding out she can put her mark on the issue but it can be at the risk deepening the “blight and despair” for many of the 2.2 million distressed California homeowners needing assistance now who can’t afford to wait for a political gamble.

Bloomberg reports:

“A person involved in California’s negotiations confirmed the origination of mortgages is a sticking point in the deal, along with other releases of liability for violations of state “false claim” laws, and securitization, or the packaging of mortgages into bonds sold to investors.

The most recently drafted terms of the deal offer the banks such releases in exchange for a refinancing program for people who are still in their homes and current on their mortgage payments, the person said. It ignores victims of the most egregious origination fraud who were the first to lose their homes to foreclosure, the person said.”

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  1. February 6, 2012 at 2:19 pm

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