Smaller banks next in line over mortgages

First they came for the big banks, and I did nothing ... The nation's largest lenders nearly sucked dry from mortgage settlements, housing regulators have turned their attention to a number of smaller players, with Fifth Third Bancorp (FITB), SunTrust (STI), and Regions Financial (RF) all recently disclosing investigations into the origination and servicing of home loans. U.S. Bancorp (USB) and Capital One (COF) have also disclosed probes into various mortgage practices.

Any money recouped from the regional lenders would go a long way towards stabilizing the finances of the FHA which required a $1.7B taxpayer infusion last year. "Settling with the large guys gave [the government] a template," says Eric Wasserstrom from Robinson Humphrey. "The agencies involved in the national mortgage settlement had planned to focus on the largest mortgage servicers first," says the Iowa assistant AG. "Then you move on to other entities."


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Comments (4)
  • Dirty Capitalist
    , contributor
    Comments (187) | Send Message
    It is simply a tax on banks; first large, now small as well. Unfortunately, it is part of the reason that the spread between the 10 yr note treasury and the rate the home mortgage borrower pays has moved from about 1/2 of a percent to three times that much.
    28 May 2014, 09:06 AM Reply Like
  • Ralph208
    , contributor
    Comments (67) | Send Message
    Instead of suing the banks why not sue Bush, Barney Franks and Dobbs. They along with many other politicians helped cause it.
    28 May 2014, 09:13 AM Reply Like
  • lcrupp
    , contributor
    Comments (104) | Send Message
    It would be true to form if this administration pushed them all into bankruptcy. Then we could complete the race to become a third-world country.
    28 May 2014, 09:15 AM Reply Like
  • dealraker
    , contributor
    Comments (925) | Send Message
    It was all Obama's fault. Bush had the economy perfect when he left office. That's why he uttered these words about the USA, "This sucker is going down."
    28 May 2014, 03:54 PM Reply Like
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