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NEW YORK (TheStreet) -- JPMorgan Chase (JPM) - Get JPMorgan Chase & Co. Report reached a $4.5 billion settlement late Friday with 21 institutional investors in disputes over residential mortgage backed securities (RMBS).

As part of the deal, JPMorgan will make a binding offer to the investors in 330 different RMBS trusts issued by JPMorgan, Bear Stearns (acquired by JPMorgan in 2008) and Chase, according to an announcement from Gibbs & Bruns, a Houston-based law firm representing the investors.

The investors include Fannie Mae (FNMA) , Freddie Mac (FMCC) , Blackrock (BLK) - Get BlackRock, Inc. Report, Goldman Sachs (GS) - Get Goldman Sachs Group, Inc. Report and PIMCO, among others. The trustees of the RMBS trusts, including BNY Mellon  (BK) - Get Bank of New York Mellon Corporation Report, Wells Fargo (WFC) - Get Wells Fargo & Company Report and HSBC, among others, must still approve the deal and have 60 days to reach a decision. Claims of individual investors will not be affected by the settlement, which does not cover claims against RMBS sold by Washington Mutual, which JPMorgan acquired in 2008.

The deal is similar in many respects to a controversial 2011 RMBS settlement for $8.5 billion involving claims brought by many of these same investors against Bank of America (BAC) - Get Bank of America Corp Report. That deal, approved by trustee BNY Mellon, is still being disputed by investors including AIG. Hearings have gone on for 32 days in New York State Supreme Court and a judge has yet to rule on the matter.

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The settlement over bonds stuffed with mortgages that were fraudulent or in other ways didn't meet the criteria promised when the RMBS were sold to investors, is just one of various legal disputes tied to mortgage securities sold by JPMorgan or banks it acquired. 

-- 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.