Officials said the first step in correcting the foreclosure debacle that erupted last year -- characterized by banks taking short cuts to close quickly on tens of thousands loans -- is for banks to sign an agreement to change their ways, the Times said. Fines for cheating homeowners of due process are expected later, the report said.
The agreement between the government and the nation's 14 largest lenders is to include a suspension of foreclosures involving homeowners who are pursuing loan modifications.
In the main, the agreement gives banks pursuing foreclosures the option of either hiring and training more staff or putting the brakes on the rush to get foreclosures completed, the Times said.
The banks are also expected to agree to provide one contact point for homeowners and to hire a third-party consultant to review foreclosures done over the past two years, and assign compensation to homeowners where mistakes were made.
At a banking conference in Washington this week, JP Morgan Chase Chief Executive Officer Jamie Dimon said, "Some of the mistakes were egregious, and they're embarrassing. But we made a mistake, and we're going to pay for that mistake."