It's been 21 days since the government announced with great fanfare a $25 billion national foreclosure settlement with five big banks -- long enough for three generations of houseflies to live, love and die.
But the deal, which resolves claims that the banks forged or "robo-signed" signatures to speed foreclosures and committed a host of other loan servicing errors, isn't final until the government files it in federal court. Until then, the public is left to guess whether the settlement is as tough on the banks as the government claims and whether the promised enforcement mechanisms to ensure banks are playing by the rules have real teeth.
The final settlement document should spell out in exact language the rules of the deal. As of now, the government has released only a summary.
On Tuesday, Shaun Donovan, the secretary of housing and urban development, assured the Senate housing committee that finalizing the documentation was mostly a matter of "dotting i's and crossing t's." No need to worry that the parties were still dickering behind the scenes, he said.
Donovan also said at the hearing that the papers should be filed in the federal district court in Washington, D.C., this week. But sources familiar with the drafting of the documentation say the filing date has likely been postponed again. Next week is now the target. These sources chalk up the delays to simple logistics: Dozens of state and federal agencies, plus the five banks (JPMorgan Chase, Bank of America, Wells Fargo, Citigroup and Ally Financial), must sign off.
Why wasn't all this done in advance of the Feb. 9 announcement? The Securities and Exchange Commission, for example, often files a court complaint against and announces a settlement with a company accused of financial misconduct on the same day.
The Department of Housing and Urban Development declined to comment through a spokesman, but a gathering flood of leaks about the status of the deal probably forced the government to announce too soon. As such, some delay is to be expected.
Still, each day that passes drives speculation about whether the deal is as set in stone as the government has led the public to believe. A recent regulatory filing by Bank of America with the SEC has added fuel to this argument.
"There can be no assurance as to when or whether binding settlement agreements will be reached, that they will be on terms consistent with the Servicing Resolution Agreements, or as to when or whether the necessary approvals will be obtained and the settlements will be finalized," reads language in the bank's annual 10-k filing.
Government officials who are collecting signatures and ironing out the details say emphatically that there are no substantive issues still to resolve. "This is not an accurate description of where we are," a senior government official told The Huffington Post after reading the Bank of America language.
Wells Fargo, in its annual 10-k filing, did not include this kind of hedging language.
Still, the continuing delay and the Bank of America language are worth at least one raised eyebrow.