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Bank of America to stop selling new home loans to Fannie Mae
Source: Washington Post
Bank of America to stop selling new home loans to Fannie Mae
By Hugh Son, Thursday, February 23, 9:14 PM
Bank of America, the second-largest U.S. lender by assets, will stop selling new home loans to Fannie Mae after a dispute over faulty mortgages.
Starting this month, the Charlotte-based bank will deliver only loan modifications and refinancings to U.S. government-controlled Fannie Mae, the bank said Thursday in its annual filing with securities regulators.
Chief executive Brian T. Moynihan has been cutting expenses and jobs to revive profitability while fending off legal disputes tied to faulty home mortgages, with Fannie Mae among the biggest claimants. The bank’s 2008 acquisition of Countrywide Financial, which was the largest home lender during the U.S. housing bubble, left Bank of America responsible for shoddy loans that contributed to about $42 billion in costs.
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The bank will either sell new loans to Freddie Mac, the other U.S.-controlled mortgage finance company, or retain them on its balance sheet, said a person with direct knowledge of the lender’s plans.
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By Hugh Son, Thursday, February 23, 9:14 PM
Bank of America, the second-largest U.S. lender by assets, will stop selling new home loans to Fannie Mae after a dispute over faulty mortgages.
Starting this month, the Charlotte-based bank will deliver only loan modifications and refinancings to U.S. government-controlled Fannie Mae, the bank said Thursday in its annual filing with securities regulators.
Chief executive Brian T. Moynihan has been cutting expenses and jobs to revive profitability while fending off legal disputes tied to faulty home mortgages, with Fannie Mae among the biggest claimants. The bank’s 2008 acquisition of Countrywide Financial, which was the largest home lender during the U.S. housing bubble, left Bank of America responsible for shoddy loans that contributed to about $42 billion in costs.
[font size=1]-snip-[/font]
The bank will either sell new loans to Freddie Mac, the other U.S.-controlled mortgage finance company, or retain them on its balance sheet, said a person with direct knowledge of the lender’s plans.
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Read more: http://www.washingtonpost.com/business/economy/2012/02/23/gIQAf8qcWR_story.html
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