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Citigroup Suspends Foreclosures in Gulf Coast Areas Amid BP Oil Spill

Strategic Insights

— 1 min read

Citigroup, which received a $45 billion bailout from taxpayers, has announced a three-month suspension of foreclosures in coastal areas impacted by the BP oil spill in the Gulf of Mexico. The move comes as the company aims to alleviate the burden on residents of the affected states. The suspension will apply to loans owned by Citigroup's mortgage unit, not debt serviced for other lenders or investors.

Key Takeaways:

  • Citigroup will suspend foreclosures in coastal areas within 25 miles of the Gulf of Mexico for the next three months, covering approximately 1,200 homeowners.
  • The bank's decision is part of its effort to ease the burden on residents of the Gulf states affected by the BP oil spill.
  • Citigroup's mortgage unit, CitiMortgage, has had "very encouraging" discussions with companies that service home loans, which may lead to expanding the moratorium to their borrowers.
  • Citigroup's CEO, Vikram Pandit, stated that the company aims to help people avoid foreclosure so they and their families can remain in their homes and have one less thing to worry about.
  • The bank has also acknowledged that it will continue to explore ways to help homebuyers in the affected areas.
  • Sanjiv Das, head of CitiMortgage, emphasized that the bank's goal is to provide relief to homeowners who are struggling due to the oil spill disaster.
  • The suspension will apply to evictions, and homeowners who have already had their properties seized will have their evictions halted.
  • This move is in line with Fannie Mae's recent reminder to companies that manage its loans to suspend or reduce payments for borrowers for at least three months.

Statistics:

  • 1,200: The estimated number of homeowners protected by Citigroup's foreclosure suspension.
  • 45 billion: The amount of funds provided by taxpayers to bail out Citigroup.
  • 3 months: The duration of the foreclosure suspension in coastal areas.
  • 25 miles: The radius within which homeowners will be covered by the suspension.
  • $45 billion: The total value of taxpayer funds invested in Citigroup through the bailout.

Sources:

  • Bloomberg News
  • Citigroup Inc. statement, July [no date specified] (note: no date was provided in the original text)
  • Fannie Mae press release (no date mentioned, but referenced in the article as having previously issued a reminder to companies managing its loans)

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