Bank of America pays Freddie Mac $404 million over subprime loans

http://www.rawstory.com/rs/2013/12/02/bank-of-america-pays-freddie-mac-404-million-over-subprime-loans/



Bank of America pays Freddie Mac $404 million over subprime loans
By Agence France-Presse
Monday, December 2, 2013 12:14 EST

Bank of America said on Monday it will pay mortgage financier Freddie Mac $404 million to resolve claims over subprime loans the bank sold before the housing crisis.

Bank of America said the agreement would resolve all of Freddie’s remaining claims over more than 700,000 mortgage loans the bank’s Countrywide unit sold Freddie between 2000 and 2009.

Countrywide, which Bank of America took over in 2008, has been accused of generating and selling on to companies like Freddie and Fannie Mae millions of weak and poorly documented home loans as investment-quality assets.

A high percentage of the loans quickly fell into default when the economy plunged into recession in 2008, causing losses to the holders of the loans and securities they were bundled into.