Real Estate, Lawsuit Settlement | featured news

Relief checks issued as part of a settlement over foreclosure abuses have bounced, an unfortunate twist for consumers who have already faced problems over reviews of troubled mortgage loans.

A Manhattan federal judge on Monday signaled he will not rubber-stamp Citigroup Inc's proposed $590 million settlement of a shareholder lawsuit accusing it of hiding tens of billions of dollars of toxic mortgage assets.

A $10 billion settlement to resolve claims of foreclosure abuses by major lenders is expected to be announced on Monday, several people with knowledge of the discussions said.

Citigroup said on Wednesday that it had agreed to pay $590 million to settle a class action lawsuit brought by shareholders who contended that they had been misled about the bank’s exposure to subprime mortgage debt on the eve of the financial crisis.

Wells Fargo Bank will pay at least $175 million to settle accusations that it discriminated against African-American and Hispanic borrowers in violation of fair-lending laws, the Justice Department announced Thursday.

The U.S. government said on Thursday that the biggest U.S. banks will provide $25 billion in relief to distressed homeowners and states, as officials hold lenders responsible for taking illegal shortcuts during foreclosures and other mortgage paperwork.

California's attorney general said on Thursday her state will receive up to $18 billion in benefits under a federal-state mortgage settlement to be announced later today.

JPMorgan Chase & Co, the second largest U.S. bank by assets, led a broader decline in bank share prices, as investors feared lenders face a growing list of lawsuits due to problem mortgages.

Countrywide Home Loans agreed to pay borrowers $108 million for charging excessive fees when they fell behind on their mortgages.

Bank regulators announced settlements on Wednesday with the largest home lenders over allegations of shoddy foreclosure practices, but the pacts did not include financial penalties.