DES MOINES, Iowa (Legal Newsline) - Iowa Attorney General Tom Miller says he hopes a deal with the nation's top mortgage servicers will be done by Christmas.
Miller told the Des Moines Register Thursday a settlement should be reached in the coming weeks, whether or not California decides to participate.
For months, Miller has been heading up talks with the five banks over their mortgage foreclosure practices, including Wells Fargo & Co., JPMorgan Chase & Co., Citigroup Inc., Ally Financial Inc. and Bank of America Corp.
The probe began last October with inquiries into so-called "robosigning" practices by several mortgage companies, and has since broadened into identifying and addressing additional alleged improper foreclosure practices.
Miller told the Register the rumored $20 billion deal wouldn't stop individuals or government prosecutors from suing the banks.
Under the settlement, the banks also would agree to shell out for principal reductions and consent to certain servicing standards, the Iowa attorney general told the newspaper.
Although he would not provide an exact settlement figure, Miller said the amount would drop if California doesn't sign on.
In September, California Attorney General Kamala Harris backed out of the mortgage talks. This week, she and Nevada Attorney General Catherine Cortez Masto formed a joint investigation.
In a letter to Associate U.S. Attorney General Thomas Perrelli and Miller, Harris called the deal "inadequate" for homeowners, saying it provided too much protection for financial institutions.
"After much consideration, I have concluded that this is not the deal California homeowners have been waiting for," Harris wrote at the time.
"(The) relief contemplated would allow too few California homeowners to stay in their homes."
However, Miller has been trying to convince Harris to rejoin.
He reportedly attended a nationwide attorneys general conference in San Antonio, Texas, with her last month and was said to have pleaded his case as to why she should participate in the settlement.
Harris announced earlier this week that she and Masto have begun their own joint investigation into misconduct and fraud in the mortgage industry.
Both attorneys general say their states have been the hardest hit by the foreclosure crisis by most objective measures. In both states, banks can foreclosure on a home without court oversight.
From Legal Newsline: Reach Jessica Karmasek by email at firstname.lastname@example.org.
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