JPMorgan and Bank of America Disclose Costs of Foreclosures

by Isaac Benmergui, Esq on November 9, 2011

Buying back defective and faulty loans related to the housing bust has cost the big banks, big. JPMorgan reported faulty mortgages and foreclosure expenses of $1.3 billion for the third quarter of 2011. The bank originally ear-marked only $314 million for the buy backs, but incurred an additional $1 billion in litigation costs.

The former inspector general of the U.S. Troubled Asset Relief Program, Neil Barofsky, believes the high cost to the banks is well-deserved.

Bank of America’s costs were around $1.18 billion for the third quarter, which included $278 million for buy backs, $500 million for litigation costs and $400 million in waivers and assessments fees related to the foreclosures.

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