Why do years seem to go by, with more Fort Lauderdale homeowners facing foreclosure, and the mortgage banks that caused the financial crisis still making millions, even billions of dollars? It seems that the problems caused by the banks are so big, and the banks' misdeeds part of a system so vast and difficult to understand that the legal system is moving at a snail's pace trying to come to grips with what the banks did and what can and should be done about it.

The biggest mortgage banks, such as Bank of America, not only made bad loans, but securitized the risk of those bad loans. The investors lost their money, and the homeowners have been losing their homes to foreclosure. Everyone wants the banks to pay for what they did, but for now it seems as though only the big-money investors have the resources and the sophistication to take on the big banks.

So it may turn out to be good news not only for mortgage security investors, but for homeowners as well, that the American International Group (AIG) is planning to sue Bank of America (BofA) over $28 billion in losses on mortgage-backed securities. AIG says that BofA intentionally gave misleading information about the risk involved in its mortgage-backed securities. AIG wants at least $10 billion of its money back from BofA.

Fort Lauderdale foreclosure defense lawyers are hoping that the wide-ranging, financially sophisticated and expensive investigation that AIG will make as part of its lawsuit will uncover systemic wrongdoing by BofA that will smooth the path for homeowners to recover lost money and seek compensation, not only from BofA but other major mortgage banks that have acted in a similar way.

Source: NYT "A.I.G. to Sue Bank of America Over Mortgage Bonds" Aug. 8, 2011