Bank of America Agrees to Pay Freddie Mac $404 Million

Bank of America Agrees to Pay Freddie Mac $404 Million
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December 02, 2013

Bank of America (BofA) has agreed to pay Freddie Mac $404 million to settle all remaining claims over home loans sold over the last decade.

Bank of America says that this final settlement resolves all claims on loans sold from 2000 through 2009, which includes mortgage-backed investments that soured during the housing crash.

Earlier this year, Bank of America agreed to pay $3.6 billion in cash to Fannie Mae, Freddie Mac's sister company, and buy back $6.75 billion in home loans sold by BofA and Countrywide Financial, a company that Bank of America bought in 2008.

Both Fannie Mae and Freddie Mac buy mortgages from banks and package them as bonds to sell. The government rescued both companies during the financial crisis in 2008 with loans totaling roughly $187 billion.

To date, about $136 billion of that aid has been repaid.

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