BofA Borrowers Sign Confidentiality Pacts Before Getting Loan Modifications, Ariz. AG Says

Posted Jan 27, 2012 8:03 AM CST
By Debra Cassens Weiss

The Arizona Attorney General’s office is asking a judge to block confidentiality agreements signed by borrowers who get mortgage modifications from Bank of America.
Arizona Attorney General Tom Horne says the agreements are impeding his office’s investigation of the bank’s Countrywide Financial unit, according to the Phoenix Business Journal and Bloomberg News.
One agreement is cited in court documents in Phoenix state court. It provides that the borrower "will remove and delete any online statements regarding this dispute, including, without limitation, postings on Facebook, Twitter and similar websites.” The settlements bar borrowers from revealing unflattering information about the bank, even if they are subpoenaed, according to prosecutors.
Bank of America says in court documents that the confidentiality agreements are not a requirement, and settlement agreements with consumers are “standard fare.”

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BofA Initiates New Loan Sharking Program - Excuse Me, Rate Hikes - For Small Business

Posted: 03 Jan 2012 07:00 AM PST

Remember when we floated banks all that money so they could lend to small businesses, and instead they used it to pay bonuses and shore up their profits? Ah, good times! Now Bank of America has decided to jack up small business owners by boosting their interest rates to payday-loan-type levels in order to build their "core" business:

Bank of America Corp., under pressure to raise capital and cut risks, is severing lines of credit to some small-business owners who have used them to stay afloat.

The Charlotte, N.C., bank is demanding that these customers pay off their credit line balances all at once instead of making monthly payments. If they can't pay in full, they are being offered new repayment plans for as long as five years, but with far higher interest rates than their original credit lines had.

Business owners complain that BofA's credit squeeze is abrupt and could strain their small companies and even put them out of business. The credit cutoff is coming at a time when the California economy can't seem to catch a break, and bucks what the financial industry says is a new trend of easing standards on business loans.  READ MORE

Bank of America Death Watch: Moody's Downgrades B of A Credit, Signals Bailouts Less Likely

The most interesting thing about the credit rating agency's decision to downgrade Bank of America, Wells Fargo, and Citigroup wasn't the downgrade in their credit rating itself: it was the signal, reported by the New York Times, that the federal government is not going to step in and save the big banks from themselves this time: The downgrades were driven by Moody’s conclusion that the federal government was less likely to step in and provide support for a faltering big bank the way it did after the 2008 collapse of Lehman Brothers, when Washington executed a series of actions including capital infusions and credit guarantees to halt the spreading panic. Read more