Secretary Donovan announces the settlement at the Department of Justice in the company of Attorney General Eric Holder and Attorneys General from affected states.

American families are all too familiar with the story: just when they thought they had achieved the dream of owning their own home, abuses in the financial and mortgage sector came back to haunt them and sent them spiralling into foreclosure – often through no fault of their own. Countless other families are still struggling to keep their underwater mortgages today.

That is why a historic agreement announced today could not come any sooner. Today the federal government and state attorneys generals for 49 states and the District of Columbia reached a $25 billion agreement with the nation’s five largest mortgage servicers. As a result, struggling homeowners throughout the country will benefit from reduced principals and refinancing of their loans.

“No compensation, no amount of money, no measure of justice is enough to make it right for a family who’s had their piece of the American Dream wrongly taken from them,” said President Barack Obama. “And no action, no matter how meaningful, is going to, by itself, entirely heal the housing market.  But this settlement is a start.” Continue reading →