Bank of America Loses $2 Billion in Real Estate Business

Posted on January 24, 2011


“Bank of America’s mortgage woes caused $2 billion in write-offs in its real estate business.” The agreement Bank of America reached a settlement agreement with Fannie Mae and Freddie Mac over liabilities related to bad mortgage loans. Wall Street saw this as a positive move because of the cap on liability.

The optimism is misguided. There is a huge potential for liability related to wrongful foreclosure lawsuits. In the end, the marketplace itself may kill “too big to fail.”