Chances are, if you're reading this blog, it's because you're experiencing fallout from a legal matter you may not know how to handle. You're not alone; in fact, thousands of businesses across the nation, including here in Florida, have a question regarding business law from time to time and we're always here to answer those questions and help you get through the worst of a bad situation.
When companies find themselves facing litigation, seeking the assistance of a skilled attorney is usually the first step because they can help advise you through the process. This was probably the case for Bank of America who, for the past few years, has been handling the incredibly difficult legal issues that have cropped up surrounding the mortgage crisis.
In 2008, Bank of America purchased Countrywide, a mortgage company that had become one of the nation's largest subprime lenders during the housing boom. Between 2000 and 2008, however, Countrywide had sold a majority of its mortgages to investors like Fannie Mae and Freddie Mac, mortgages Fannie Mae claimed had been dishonestly labeled as 'quality loans' before they were sold.
When hundreds of thousands of people began defaulting on these loans, Fannie Mae went after the original lenders stating that the loans had been misrepresented and demanded that their investments be refunded.
Bank of America, who has been at the center of business litigation because of the mortgage crisis for quite some time now, finally agreed this month to a $10 billion settlement that would finally rid itself of the problems it took on when it purchased Countrywide. According to the bank's chief executive, the settlement allows them to focus more on their clients now and hopefully allows them to continue resolving future mortgage issues that arise.
Source: The Los Angeles Times, "Bank of America to pay Fannie Mae $10 billion in loan settlement," Jim Puzzanghera, Jan. 7, 2013