BAC stock quote
In addition to last month's settlement, Bank of America (NYSE: BAC) announced Thursday it would cut qualified borrowers' balances by even more than originally agreed to in a side mortgage deal with U.S. authorities.
The bank said it would slash loan balances by an average $100,000. If Bank of America meets the provisions of the mortgage deal - which includes a separate agreement to reimburse HUD $1 billion for loan-related issues - within three years, it will be forgiven $850 million in penalty payments.
The biggest U.S. mortgage lenders, including Bank of America, finally reached a $25 billion mortgage settlement last month to help homeowners. The provisions to the mortgage settlement included $5 billion total in cash penalties, payable to borrowers, states, and the federal government, and $20 billion in additional aid reached by reducing homeowners' loan balances, and refinancing for underwater homeowners.