Hugh Son, Bloomberg
Bank of America Corp. agreed to pay $404 million to Freddie Mac in a deal that caps the lender’s efforts to resolve repurchase claims from government-sponsored enterprises on mortgages sold before the financial crisis.
The accord covers about 716,000 loans created by Charlotte, North Carolina-based Bank of America from Jan. 1, 2000, to Dec. 31, 2009, and sold to Freddie Mac, the firms said today in separate statements. The payment, minus credits of $13 million that the bank already paid Freddie Mac, is covered by current reserves, the lender said.
Bank of America Chief Executive Officer Brian T. Moynihan, 54, has spent more than $50 billion settling claims tied to shoddy mortgages sold before he took over in 2010. Previous settlements, including one with Freddie Mac in January 2011, focused on loans sold by Countrywide Financial Corp., which the bank acquired in 2008. Today’s deal resolved disputes over mortgages sold by Bank of America, the second-biggest U.S. bank.