Bank of America to pay Fannie Mae billions to settle mortgage claims

The bank will pay $10.3bn to settle claims relating to the loans and $1.3bn in compensation to the agency.Fannie Mae argued the bank sold it toxic debts and should be responsible for the losses it suffered.

Separately, 10 big mortgage providers agreed to pay $8.5bn compensation for mistakes in repossessing homes.

The banks include Bank of America, Citigroup, JP Morgan and Wells Fargo. They will pay $3.3bn directly to homeowners, some of whom should not have lost their homes, regulators said.

Individual owners will receive anything from a few hundred dollars to $125,000.

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