AG Settlement Will Not Block Private Action Against Mortgage Fraud

Today’s New York Times reports that an a comprehensive Settlement between Banks and State Attorneys General imminent, with California and New York back at the bargaining table.

What is important for  homeowners to know about the settlement is that immunity for individual liability is totally off the table.  Here is what the Times reports:

“In addition, said Patrick Madigan, the Iowa assistant attorney general, homeowners who participate in the settlement will still have the right to sue the banks for improper behavior in the foreclosure process.”

My conversations with my former colleagues support this reporting.  Homeowners facing foreclosure will still be able to defend against fraudulent foreclosure practice and bring suit under the Fair Debt Collection Practices Act and other consumer laws.

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