Massive Mortgage Loan Abuse Settlement

Friday, February 10, 2012 at 6:29 AM

(Washington, D.C.) – Homeowners who saw their homes wrongly foreclosed upon will receive part of a massive settlement unveiled Thursday.

The $25 billion settlement resolves government lawsuits over faulty foreclosures and servicing misconduct by several American banks. Millions will be sent to Indiana, Ohio, and Kentucky.

In a news conference, Attorney General Eric Holder called it a landmark settlement involving reckless mortgage practices known as “robo-signing.”

Holder said it is the largest civil settlement in U.S. history.

The attorney general noted that the settlement does not prevent state or federal authorities from pursuing possible criminal actions on mortgage fraud.

The banks include Bank of America, Wells Fargo, JPMorgan Chase, Citigroup and Ally Financial, which was formerly known as GMAC.

Several states have joined the federal government in the settlement.

Indiana’s share will be $145 million divided up into maximum amounts of $2,000 to 13,000 foreclosure victims in the state, Indiana Attorney General Greg Zoeller said.

Ohio will receive $335 million and Kentucky will see $58.8 million as part of the same settlement.

Information regarding the national settlement can be found online at www.nationalforeclosuresettlement.com.