The mortgage foreclosure settlement looks to be in the final stages of being negotiated and an announcement could come as soon as Thursday morning, sources close to the talks tell FOX Business.
In a surprise move, California and New York will likely be part of the $25 billion deal, after holding out for better terms.
The multistate settlement would finally put a number on the obligations for the five largest lenders: Bank of America (NYSE:BAC), JPMorgan Chase (NYSE:JPM), Citigroup (NYSE:C), Wells Fargo (NYSE:WFC) and Ally Financial. The price tag, expected to be approximately $25 billion, would include refinancing of underwater mortgages as well as implementing new processes for lenders. Lenders are accused of filing false documents to foreclose homes, otherwise known as robo-signing.
California and New York did not join the deal on the original deadline of February 6 after more than 40 states had joined the pack, according to Iowa Attorney General Tom Miller’s office, who led the talks. California, with the highest number of foreclosures, officially had dropped out of the talks in recent months, but was reportedly negotiating directly with the government.
HUD Secretary Shaun Donovan pushed for the talks to come to a close after nearly a year of false starts. Details of the agreement are still emerging and the final figure is fluid as details of the deal are ironed out.
Iowa Attorney General Tom Miller’s office declined to comment.