Fannie Mae, Wells sign $591 million settlement
Dec. 31, 2013 – Fannie Mae has reached a $591 million agreement with Wells Fargo to settle claims that Wells sold Fannie poorly underwritten loans before the housing bubble burst – action that also marks the end of Fannie’s review of such claims.
After adjustments for prior repurchases, Wells Fargo will pay Fannie Mae $541 million in the fourth quarter of 2013. It will be released from repurchase liability for these loans, with certain exceptions, Fannie announced Monday.
“We have closed out our legacy repurchase reviews with this agreement with Wells Fargo,” said Tim Mayopoulos, Fannie Mae’s president and CEO. “This agreement represents a fitting conclusion to our year of hard work to put legacy issues in the rear view mirror and begin 2014 focused on improving the future of housing finance.”
Fannie said Wells Fargo will remain obligated for certain other contractual responsibilities under the resolution agreement.
The government-sponsored enterprise notes it has reached resolutions this year with a number of lenders on repurchase issues and other matters. Among those involved are Bank of America, CitiMortgage, SunTrust, JPMorgan Chase, Flagstar, PNC and HSBC Bank USA.
Fannie Mae announcement