Source: N.Y.Times Editorial ( Free Registration )

Attorney General Eric Schneiderman of New York announced this week that he plans to sue Bank of America and Wells Fargo for failure to adhere to the terms of a $26 billion settlement that was supposed to provide relief to homeowners and end foreclosure abuses.

The lawsuits are another sign that more than a year after the mortgage settlement between five big banks and state and federal officials banks are still mishandling foreclosures in ways to benefit themselves while harming borrowers.  Mr. Schneiderman said Bank of America and Wells Fargo have violated the settlement’s mortgage servicing standards, which, among other procedures, set timelines for processing borrowers’ requests for loan modifications. The timelines are crucial because banks have been notorious for losing and delaying paperwork, causing borrowers to incur late fees and interest penalties while falling further behind.

Read Full Article: Banks still behaving badly