California will be receiving $18 billion is a multi-state mortgage deal with the nation’s largest lenders, according to Attorney General Kamala Harris’. The money represents more that 70 percent of a $25 billion agreement involving most of the states and the major banks, Bank of America, JPMorgan Chase, Wells Fargo, Citigroup and Ally Financial, which all previously made up GMAC.
The $18 billion will be distributed in the following ways according to the Attorney General:
More than $12 billion is guaranteed to reduce the principal on loans or offer short sales to approximately 250,000 California homeowners who are underwater on their loans and behind or almost behind on their payments.
$849 million is estimated to be dedicated to refinancing the loans of 28,000 homeowners who are current on their payments but underwater on their loans.
$279 million will be dedicated to offering restitution to approximately 140,000 California homeowners who were foreclosed upon between 2008 and December 31, 2011.
$1.1 billion is estimated to be distributed to homeowners for unemployed payment forbearance and transition assistance as well as to communities to repair the blight and devastation left my waves of foreclosures, targeted at 16,000 recent foreclosures. Last year 5,730 foreclosures came on the market in San Diego County.
$3.5 billion will be dedicated to relieving 32,000 homeowners of unpaid balances remaining when their homes are foreclosed.
Finally, $430 million for costs, fees and penalty payments.
“California families will finally see substantial relief after experiencing so much pain from the mortgage crisis,” Harris said. It is unclear the amount San Diego County homeowners will be receiving. “Unlike the larger multi-state agreement, which is enforceable in the federal court in Washington, D.C., this payment provision empowers the Attorney General to summon the banks to California state court,” the Attorney General’s office said.