Biz: Federal government, states agree to settle with mortgage industry
- $26 billion “historic” settlement with the mortgage industry
- $17B of that settlement is expected to help out more than 1 million homeowners — breaking that dow, that’s an average of $17,000 each
- 50 states could sign on as part of the settlement, making it the largest multistate settlement since the big tobacco deal in 1998
- $2,000 the amount some homeowners who already lost their homes to foreclosure could get as part of the long-planned settlement source
- » But is all this enough? While some will say the settlement doesn’t go far enough in addressing the concerns homeowners have dealt with in the years since the housing bubble burst, officials suggest it could provide $40 billion in mortgage relief by reducing loan principals, which would make the dollars go further. Problem is, it’s estimated that homeowners collectively owe $700 billion more on their homes than they’re actually worth. So while the dollar number sounds high, it may only be a drop in the bucket comparatively.