B of A recently settled an agreement with Freddie Mac and Fannie Mae. The financial institution will compensate them for toxic guaranteed loans the financial institution is responsible for. The two mortgage houses have to be compensated for toxic assets sold to them by the various parties that sold them. B of A is paying over $3 billion in total. B of A is expected to take a loss on the deal.
Trying to help make amends is Bank of America for the bad guaranteed loans out there
The toxic mortgage assets sold to Freddie Mac and Fannie Mae got Bank of America to make an agreement. MSN reports this agreement was finalized. Bank of America didn't sell all the bad guaranteed loans to Freddie or Fannie. The negotiation is largely over loans that were originated by Countrywide, which was purchased by and merged into Bank of America in 2008. Countrywide was one of the biggest mortgage providers in the nation before that occurred. Of all people who bought a home from NY to San Diego and all points in between before the 2008 mortgage crisis, about one in five got their home loans from Countrywide. The Fannie and Freddie settlement was part of the Countrywide assets. These were all taken by Bank of America.
Nation's largest financial institution anticipated to lose with this one
The nation's biggest bank is B of A. Still, the financial institution is anticipated, in the fourth quarter of 2010, to file a $2 billion loss. Mortgages sold to Freddie, Fannie and others from Countrywide mortgages got the financial institution to set money aside already. $3 billion was prepared for this. About $11 billion in bad financial institution loans was bought already while about $2.6 billion still need to be bought by Bank of America. It could be finished by B of A without a cash loan. The business is rolling in dough.
Still owing the home loan houses
Many of the toxic home loan assets sold to Fannie Mae and Freddie Mac have been bought back by large banks although some nevertheless owe. The 2 corporations are run by the government nevertheless though.