Fannie Mae and Ally Financial Inc. have reached a #462 million settlement agreement which relieves the company from its obligation to buy back trouble mortgages it sold.
Ally, then GMAC, has taken at least $17 billion in federal bail-out money and is 56 percent-owned by the U.S. government. The company, like many of the other “big banks”, are being threatened with lawsuits from investors who purchased mortgage-backed securities from the banks.
They allege the bank knew they were selling bad mortgages that would eventually default, but did not inform those investors of that risk.
The same banks are facing even more scrutiny over the wrongful foreclosure debacle in which it hired a “robo-signing” firm to quicly process foreclosures, including falsely signing court documents authorizing foreclosures.
This has led to thousands of wrongful home foreclosures across the country.