Dan Walters

Dan Walters

By Dan Walters
Published: Tuesday, Feb. 18, 2014 – 12:00 am

Two years ago, Attorney General Kamala Harris trumpeted a landmark deal with the nation’s three largest housing lenders, which agreed to give beleaguered California homeowners $12 billion in relief from their underwater mortgages.

Last fall, the monitor that Harris appointed to supervise the agreement reported that the $12 billion promise had become “an $18 billion achievement,” half in principal reductions for those who wanted to remain in their home and half in short sales for those who wanted out.

“A home saved from foreclosure helps stabilize the neighborhood, prevent blight and buy up housing prices,” the monitor’s report said.

Harris announced her bid for re-election to a second term the other day and touts the deal as a major achievement. She’s considered a prospective future candidate for governor or U.S. senator.

There is, however, a darker side to the situation. That $9.2 billion in principal reductions from the three big lenders, plus those granted by other mortgage firms, is considered to be income to those who received them – an average of $137,281 for first mortgages in the settlement and $91,261 for second mortgages.

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