FL AG Bondi may consider reduced principals in the state AGs agreement

In the spring, Attorney General Pam Bondi, the top prosecutor in a state shattered by the housing crash, took a very public stance against forcing banks to reduce principals as part of a settlement between all 50 states and the nation's largest lenders.

Thankfully, Bondi and her counterparts in Virginia, Texas and South Carolina who argued that writing down loans could encourage more people to default lost that fight.

Principal reductions are still on the table," said Geoff Greenwood, spokesman for Iowa Attorney General Tom Miller, who is leading the states' negotiations with the banks.

And even Bondi, whose tough-on-foreclosure-fraud credentials have been under fire lately, seemed more open to the idea, if only slightly, when I asked about it this week.

"Attorney General Bondi would consider principal reduction in cases where that is an appropriate remedy for particular harm suffered by individuals," a spokeswoman said in a statement. "The important thing is to ensure that principal reduction not cause further harm to Florida's housing market by encouraging people to default on their mortgages."

Her office did not provide examples of cases in which she thinks it would be an "appropriate remedy."

Read on.