This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

Bank of America Extends MBS Settlement Talks

NEW YORK (TheStreet) -- Bank of America (BAC) will have additional time to negotiate in a dispute with a large bondholder group over about $47 billion in soured mortgage backed securities (MBS), the bank indicated in a press release Wednesday afternoon.

Attorneys representing the bondholders, which include Pacific Investment Management Co., BlackRock (BLK), and the New York Federal Reserve wrote a letter to Bank of America and Bank of New York Mellon (BK), the trustee on the MBS, saying the loans in the MBS were not properly serviced by Countrywide, and should bew put back to Bank of America, which acquired Countrywide in 2008.

The letter argued the issues should be fixed in 60 days or Countrywide should be declared in default on its obligations.

But the press release Wednesday stated that both parties had agreed to "extend any time periods commenced by the Oct. 18 letter," adding "this extension will permit the parties to continue constructive dialogue around the concerns raised."

The dispute is one of many Bank of America and other MBS underwriters, including Goldman Sachs (GS), Morgan Stanley (MS), Citigroup (C) and several European banks are expected to contend with in the coming months and possibly years. Some analysts estimate for those institutions run well over $100 billion, though Bank of America is widely thought to have the greatest exposure to MBS putbacks.

-- Written by Dan Freed in New York.

Disclosure: TheStreet's editorial policy prohibits staff editors, reporters and analysts from holding positions in any individual stocks.

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!
DOW 17,071.24 +127.43 0.75%
S&P 500 1,977.56 +9.99 0.51%
NASDAQ 4,438.8380 +23.3480 0.53%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto
Advertising Partners

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs