Probably not: they will hold out for the best deal they can get to eliminate as much uncertainty as possible
These days, it's hard to keep all of the mortgage-related lawsuits against banks straight. Investors are suing banks over bad mortgage-backed securities, claiming that securitization procedures were flawed. The Federal Housing Finance Agency has also filed lawsuits, saying that banks misled Fannie and Freddie about the quality of the mortgages underlying the bonds they purchased. Finally, states are suing big banks over their foreclosure practices, alleging that they didn't follow the law. The banks have reportedly been offered a settlement on that last suit by the group of state attorneys general. Unfortunately, the deal the states are offering isn't likely to be accepted.
Shahien Nasiripour at the Financial Times reports on the latest progress in the settlement talks. He writes:
Though the counteroffer attempts to release the banks from liability with respect to home repossessions, and explicitly states that the release does not include securitisation claims, the language is broad enough in that it could prevent state officials from bringing securitisation claims in the future should they sign up to the agreement.
This gets a little complicated. The question here is whether the settlement should include only documentation practices related to foreclosure procedures or also banks' broader documentation missteps, which would extend to the securitization process.