How did this case come about?
Under an agreement with the Comptroller of the Currency in 2011, consultants were required to conduct loan-by-loan reviews , but they were time-consuming and costly, and oftentimes they did not benefit consumers as they were intended to. The previous agreement seemed as though it would take too long to compensate consumers and would waste too much money in the process. The new agreement was meant to save time and money.
What does this mean for the banks and consumers?
The new agreement was meant to save time and money. For the banks and consumers, it will save a lot of time. Whether it will save the banks money is debatable. While $8.5 billion may seem a hefty price-tag, consumer advocates are saying that the banks are getting off easy with payments far less than originally expected. As the settlement has set a cap for what the banks pay, advocates believe consumers could end up shorted yet again.
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