Investors are seeking restitution from some of the nation’s largest lenders due to their “misstatements or omissions in the underwriting process of residential mortgage backed securities” as reported by The Wall Street Journal.
Institutions such as Citigroup Inc., Wells Fargo & Co., and Bank of America Corp. are each facing a number of lawsuits and stand to lose billions of dollars. Market analysts have estimated that each institution could lose anywhere from 20-50 billion dollars. Representatives from JP Morgan claim damages could be as large as $120 million industry wide.
With in the lawsuits, financial institutions are being asked by investors to buy back the mortgages that failed to meet the representations and warranties standards when the mortgages were initially purchased.