Bank of America has agreed to settle claims brought by state attorneys general regarding certain risky loans originated by Countrywide Financial Corp in a deal that could be worth more than $8.6 billion, the 'Wall Street Journal' said.


Under the terms of the deal, Bank of America has agreed to, if possible, modify the terms of the loans and will first try to refinance borrowers into government-backed loans under the federal Hope for Homeowners program, which will require a cut in the principal, the Journal said.


The modification program is valued at as much as $8.4 billion and the costs of the program "have already been estimated and accounted for" by Bank of America as part of its acquisition of Countrywide, the spokesman told the paper.

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