Banks Meet With Government Officials to Begin Negotiations

By Kyle Chezum Updated on 3/31/2011

The major meeting of bank representatives and government officials finally took place on Wednesday, but if you're hoping this means a settlement was reached and we can all have done with this foreclosure litigation mess, think again.    Jessica Smith, a spokeswoman for the Justice Department, announced that the process of negotiating a settlement has only just begun.  "They cautioned we are looking at months, not weeks or days," she said.

It may seem little is riding on this agreement.  In truth, economists aren't really sure what will happen to the market once the settlement terms are imposed.  Will major banks tighten lending standards further?  This seems likely, but there's no way to know just yet.

Regardless of the financial implications of these negotiations, the American public definitely has a vested interest in the outcome.  Investigators established long ago that banks are at fault for at least a significant portion of the mess we're in, especially with regard to the improper handling of mortgage notes and foreclosure documents, and the nation wants to see justice served.  Though widespread public commentary has long since dropped off regarding the negotiations, an outcry could result if the settlement reached doesn't adequately cover the damage done.

At this point, though, it looks like we'll have to wait a while longer to discover what level of justice the government will be able to dole out.  The months to come will likely bring many new developments in this series of events.