(Updates with settlement terms in third paragraph.)
Feb. 9 (Bloomberg) -- Bank of America Corp. settled a lawsuit over mortgage modifications brought by Nevada, state Attorney General Catherine Cortez Masto said.
Resolution of the case is part of the $25 billion accord that Bank of America, JPMorgan Chase & Co., Wells Fargo & Co., Citigroup Inc. and Ally Financial Inc. reached with 49 states, including Nevada, and the federal government to end a probe of abusive foreclosure practices stemming from the collapse of the housing bubble, Masto said in an e-mailed statement today.
The Nevada agreement, independent from the multistate settlement, requires Charlotte, North Carolina-based Bank of America to set aside $750 million for lien reductions and short sales, Masto said in the statement. It also mandates that the bank suspend foreclosure sales for any borrower eligible for a mortgage loan modification program, according to the statement.
“The Nevada Bank of America settlement will bring in more money for Nevadans than what would have been available under the multistate settlement alone,” according to the statement.
Masto’s office sued Bank of America in December 2010 to undo an agreement over home-loan modifications tied to the bank’s Countrywide Financial unit, claiming the lender failed to meet its obligations. The case was being litigated in federal court in Reno.
Shirley Norton, a Bank of America spokeswoman, had ni immediate comment on the settlement.
The case is Nevada v. Bank of America Corp., 11-cv-00135, U.S. District Court, District of Nevada (Reno).
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