Attorneys General Push for Loan Reductions, Seek Bank Accord

State attorneys general are pushing lenders to reduce loan balances and said that they hope to reach a final settlement with banks over their mortgage-servicing and foreclosure practices within two months, Bloomberg News reported today. The states along with federal agencies submitted a 27-page settlement proposal last week to the country's five largest mortgage servicers and aim to reach an agreement that leads to more loan modifications for homeowners having trouble making their payments, attorneys general said yesterday. The companies that received the settlement terms service 59 percent of U.S. home loans and include Bank of America Corp., Wells Fargo & Co., JPMorgan Chase & Co., Ally Financial Inc. and Citigroup Inc. The settlement sheet seeks to force procedural changes on servicers, including banning companies from initiating foreclosure proceedings while a loan modification is pending, providing borrowers with a single point of contact, and informing borrowers of denied modifications in writing.

http://www.bloomberg.com/news/print/2011-03-07/foreclosure-settlement-said-to-be-sought-by-states-u-s-within-two-months.html