Stay up to date on Beau's work as Attorney General.
Delaware Online: Delaware getting $45 million in bank mortgage settlement
More than $45 million is bound for Delaware under a landmark $25 billion deal 49 of 50 states cemented Thursday with the nation’s biggest mortgage lenders over foreclosure abuses that occurred after the housing bubble burst.
The deal requires five of the nation’s largest banks to reduce loans for about 1 million households at risk of foreclosure. The lenders will also send checks of $2,000 to about 750,000 Americans who were improperly foreclosed upon.
The banks will have three years to fulfill the terms of the deal.
It is the largest settlement involving a single industry since the 1998 multistate, $246 billion tobacco deal. Oklahoma announced a separate deal with the five banks.
Delaware Attorney General Beau Biden jumped aboard a settlement Thursday after months of opposition that made Delaware an upstart negotiator among its fellow states. In a statement, he said the latest agreement delivers significantly better protections for consumers.
“It’s a much better deal than it was two weeks ago or two months ago,” Biden said in an interview on MSNBC Thursday afternoon, noting that the settlement will allow criminal investigations of banks to continue while providing monetary relief to Delawareans under threat of foreclosure.
President Obama also pointed out that the settlement involves behavior by the banks in the foreclosure process and provides immunity to them for actions related to the generation of mortgages or the packaging of them into pools with shares sold to investors. A federal task force headed by New York Attorney General Eric Schneiderman is continuing to probe behavior in the formation and sale of such mortgage-backed securities.
“We’re going to keep at it until we hold those who broke the law fully accountable,” Biden wrote in his statement.
The banks did get some liability protection in the settlement. It gives them protection against certain types of lawsuits related to the “robo-signing” scandal, an issue that Biden’s office had to relent on as part of the negotiations.