Tuesday July 23, 2024
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Beshear: Kentuckians, Organizations Received Nearly $18 Million From 2014 Settlement With Bank Of America

Attorney General Andy Beshear today announced nearly 350 Kentuckians and three state organizations have received a combined $18 million from the 2014 Bank of America Settlement involving the company’s mortgage loan practices during the 2008 national financial crisis.

The impact of the settlement for Kentuckians is based on the most recent compliance report by the 2014 Bank of America Mortgage Settlement Monitor released Nov. 30.

The Office of the Attorney General joined five other state attorneys general and the federal government to reach the settlement that has provided billions of dollars of relief to struggling homeowners nationwide, including funds to help defray tax liability as a result of mortgage modification, forbearance or forgiveness.

According to the compliance report, nearly 350 Kentucky homeowners have received relief from the company’s civil penalties:

  • 88 Kentuckians received debt forgiveness totaling $6.1 million.
  • 56 Kentuckians obtained loan modifications totaling $1.5 million.
  • Nearly 10 Kentuckians had their second-lien mortgages automatically extinguished.
  • 125 Kentuckians received forgiveness of their outstanding debt related to a junior lien or unsecured debt totaling $3.8 million.
  • 66 Kentuckians located in the hardest hit areas who lost a primary residence due to foreclosure or short sale or who were first time low income borrowers were given new loans that meet settlement guidelines.
  • Nearly 10 Kentuckians had their loan principal extinguished.

As part of the Bank of America Settlement, the Kentucky Bar Associations’ IOLTA Fund received $6 million; the Federation of Appalachian Housing Enterprises of Berea received $250,000; and Metro Louisville Habitat for Humanity received $99,000 to benefit Kentucky populations affected by the mortgage crisis.

The Kentucky Retirement Systems received $23 million in August 2014, from the settlement with Bank of America for defrauding the state’s pension system when the company sold high-risk loans, Beshear said.

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