The Obama administration is close to a "robo-signing" settlement with five of the country's largest mortgage servicers. But Illinois community groups blasted the proposed settlement today as a deal that would be "letting banks off the hook." Clergy, homeowners, and community groups protested in front of the state of Illinois building at 10 a.m. as U.S. Housing and Urban Development Sec. Shawn Donovan met with the state's attorney general about the possible agreement.
The Obama administration reportedly reached a deal where mortgage servicers like Bank of America Corp. would give $20 billion to the federal government as punishment for "robo-signing" legal documents. The robo-signing sped up foreclosures with little legal review.
But the community organizations that assembled this morning want a minimum of $300 billion from the banks. Advocates want the $300 billion in funds to be distributed amongst homeowners facing underwater mortgages and those who were foreclosed on.
There are fluid parts to the robo-signing agreement, including that some state attorneys general share worries that the settlement goes easy on the banks. Stay tuned.