Bank of America Settles With Fannie and Freddie for Close to $3 Billion

By Kyle Chezum Updated on 1/3/2011

1/03/11

Bank of America, it seems, won’t have to buy back any mortgages from government entities Fannie Mae and Freddie Mac.  Investors felt that the loans sold to them in the form of mortgage backed securities never should have been sold in the first place because they were toxic.  Today, the bank has agreed to a $2.8 billion settlement rather than face further litigation.

The Chief Financial Officer of Bank of America, Charles Noski, said that the bank does not plan to set aside funds for additional repurchases from Fannie and Freddie, though the settlement only addresses 44% of the bank’s outstanding repurchase requests.

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