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Daniel Wagner
Associated Press|ap.org

Hundreds of thousands of Americans stand to benefit from the latest mortgage-abuse settlement, but consumer advocates say U.S. banks may be getting the best of the deal.

Banks have agreed to pay $8.5 billion to settle charges that they wrongfully foreclosed on millions of homeowners in the wake of the 2008 financial crisis. Abuses included “robo-signing,” when banks automatically signed off on foreclosures without properly reviewing documents.

But the agreement announced Jan. 7 will also help eliminate huge potential liabilities for the banks.

Consumer advocates complained that regulators settled for too low a price by letting banks avoid full responsibility for foreclosures that victimized families and fueled an exodus from neighborhoods across the country. read more »

 

WASHINGTON — The Obama administration’s consumer watchdog agency flexed its enforcement muscles for the first time last week and ordered Capital One Bank to repay millions of credit card customers allegedly tricked into buying costly add-on services.

Capital One will pay $210 million in refunds and regulatory fines. Most of the money will go directly to customers.

The bank’s phone-sales operators told customers that services like payment protection and credit monitoring were free or mandatory or offered more benefits than they did, federal officials said. The hard selling targeted people with poor credit, they said. read more »

 

WASHINGTON — The government’s consumer finance watchdog is weighing an overhaul of the fees consumers pay to obtain mortgages.

Regulators might ban origination fees that vary with the size of the loan, known as “origination points.” They also might limit the use of “discount points” that are supposed to result in lower interest rates, the Consumer Financial Protection Bureau said.

The changes would help consumers understand the fees they are paying and guarantee that the fees provide any promised discounts, the agency said. read more »

 
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