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!

Banks Credited With $15.3B in Mortgage Relief Under National Settlement

NEW YORK (TheStreet) -- The big four banks have made "significant progress" toward meeting their obligations under the $25 billion mortgage settlement reached in 2012 over foreclosure abuses, according to settlement monitor Joseph Smith.

In his interim report, the monitor credited Bank of America (BAC), Citigroup (C), JPMorgan Chase (JPM) and Wells Fargo (WFC) for providing $15.3 billion in refinancing and consumer relief as of Dec. 31, 2012.

Note that the amount credited by the monitor is much smaller than the actual relief in gross dollar terms. Under the national mortgage settlement, the banks do not receive a dollar-for-dollar credit for most of the relief provided. They receive only partial credit for relief measures such as short sales or for modifying loans owned by investors for instance.

The gross consumer relief provided by the four banks is actually in excess of $38 billion.

In order to fulfill their obligations under the settlement, the four banks will have to show the monitor that they have provided nearly $19 billion in effective consumer relief in the form of refinancing, principal forgiveness, forbearance and other foreclosure prevention efforts such as short sales.

The monitor determined last year that Ally Financial had already delivered its obligation.

"The banks have made significant progress toward satisfaction of their total obligations, providing borrowers across the nation with much needed relief," Smith said in his report.

He noted that banks have also said they have made further progress in providing relief in 2013, which he is still reviewing.

Bank of America bears the lion's share of the settlement obligations. It is required to provide $8.5 billion in total consumer and refinancing relief.

The bank has fulfilled 97% of its obligation toward consumer relief, but has more to do toward providing refinancing relief, having met only 41% of its commitment.

Chase, Wells Fargo and Citi have on the other hand provided significantly more refinancing relief, in excess of their commitment but have more work left in other relief measures such as loan modifications and principal forgiveness.

Chase has also been credited with providing $2.78 billion in consumer relief, representing the bulk of its obligation of $3.67 billion.

Wells Fargo and Citi, however, lag further behind, having been credited with 55% and 46% of their obligations respectively.

Critics of the mortgage settlement continue to argue that banks have not done enough to provide relief for borrowers, arguing that banks are receiving credit for loan modifications they would have made irrespective of the settlement.

-- Written by Shanthi Bharatwaj New York.

>Contact by Email.

Disclosure: TheStreet's editorial policy prohibits staff editors and reporters 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 17,083.80 -2.83 -0.02%
S&P 500 1,987.98 +0.97 0.05%
NASDAQ 4,472.1080 -1.5890 -0.04%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

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