This is the first in a series examining some $65 billion of penalties paid by the banks over bad mortgages.
Updated from July 28 to include a report of Bank of America's ongoing talks to settle a mortgage case with the U.S. Justice Department in the seventh paragraph.
NEW YORK (TheStreet) -- It's a safe bet that without the 2012 $25 billion National Mortgage Settlement, Yvonne Mitchell, a 51-year-old nightshift nurse, would have lost the Bronx home where she has lived for 20 years.
A sliver of funds from the settlement went to pay for the legal assistance that she received from the Bronx division of Legal Services NYC, the agency which provides free legal assistance to Bronx residents. The legal help would be critical to Mitchell keeping her home.
"They were able to help me get a modification, because quite frankly, I don't think I'd have been able to do it on my own," Mitchell said.
Before Mitchell was able to modify the $320,000 loan she obtained in 2006, JPMorgan Chase (JPM - Get Report), the bank responsible for collecting Mitchell's mortgage payments, took her on an odyssey of rotating attorneys and bank representatives, offers made and rescinded, conflicting instructions and repeated requests for a roughly $30,000 payment that she had already made. At least one of those requests was a letter from a bank employee who knew she'd made the payment and said the letter had been generated automatically, without his knowledge.
JPMorgan, Bank of America (BAC), Wells Fargo (WFC), Citigroup (C - Get Report) and Ally Financial (ALLY), the former GMAC, collectively paid $25 billion to resolve charges related to the 2008 housing crisis that was originally brought by the federal government and attorneys general in 49 states.
The so-called National Mortgage Settlement is the largest between governmental authorities and the banks so far, but just one of the many among the $65 billion in mortgage-related settlements to have been consummated since the crisis threw the world's economy into the deepest recession since the Great Depression. More deals worth tens of billions are expected. Indeed, over the weekend, The Wall Street Journal and Bloomberg reported Goldman Sachs (GS) is in talks to settle a lawsuit by the Federal Housing Finance Agency for between $800 and $1.25 billion.
Most recently, on Thursday, July 31, The New York Times reported Bank of America had raised its offer to $14 billion from $13 billion, while adding a larger cash component, but is still shy of the $17 billion, with $10 billion in cash, being demanded by the Justice Department.