The U.S. Federal Reserve said the two banks reached an agreement similar to the $8.5 billion settlement announced Jan. 7 that involved Bank of America, JPMorgan Chase, Wells Fargo, MetLife Bank, Sun Trust, U.S. Bank, Aurora, Citibank, Sovereign and PNC.
The Fed said the settlement announced Wednesday would include $232 million in direct payments to eligible borrowers and $325 million in other compensation, such as "loan modifications and forgiveness of deficiency judgments."
The $8.5 billion settlement targeted 4 million borrowers as beneficiaries. The $557 million deal targets an additional 220,000 borrowers whose homes went through foreclosure in 2009 and 2010 with the former subsidiaries of Goldman Sacs -- Litton Loan Servicing -- and Morgan Stanley -- Saxon Mortgage Services, Inc.
Compensation could climb as high as $125,000 for an individual borrower, the Fed said.
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