Thirteen big banks were collectively handed a $9.3 billion penalty from the Office of the Comptroller of the Currency and the Federal Reserve Board for "deficient practices in mortgage loan servicing and foreclosure processing."
The regulators said amendments that memorialize agreements in principle announced in January will increase the previously announced penalty to $3.6 billion in cash payments and $5.7 billion in other assistance to borrowers, such as loan modifications and forgiveness of deficiency judgments.
In providing the $5.7 billion in assistance, the 13 servicers are expected to undertake well-structured loss mitigation efforts focused on foreclosure prevention, particularly those designed to keep borrowers in their homes "through affordable, sustainable, and meaningful home preservation actions," the OCC said this week in a release.
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