Gretchen Morgenson: Foreclosure Deal Not Enough To Restore Trust In Loan Servicers

For Banks, Foreclosure Deal 'A Drop In The Ocean'

Five big banks finally reached a deal with government authorities last week over dubious mortgage practices and foreclosure abuses.

After months of talks, Ally Financial, Bank of America, Citibank, JPMorgan Chase and Wells Fargo agreed to pay a total of $5 billion in cash to try to remedy this fiasco. They will also help homeowners who are underwater on their mortgages by reducing the principal on their loans by a combined $17 billion over the next three years.

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