The nation’s five largest mortgage banks have offered a $25 billion settlement to homeowners hurt by wrongful foreclosures. California’s attorney general calls it “inadequate.” The top Democrat on the House Education and Labor Committee agrees.
California already opted out of the settlement last fall, but experts say a nationwide deal needs the nation’s largest state, which was ground zero for the housing bust. A spokesman for California Attorney General Kamala Harris says, “the deal does not suffice for California.”
Democratic Congressman George Miller of the East San Francisco Bay area says he’s "proud" of Harris for leaving negotiations that aren’t in the state's best interest. And he says any agreement has to be transparent.
"Whatever settlement they have has to go out to the public for a week, for a period of time, where it can be commented on," Miller said, "because this represents the largest decisions about people’s homes, their equity, their assets and their worth."
The settlement would cover only mortgages held by the banks, not those covered by Fannie Mae or Freddie Mac.