Las Vega, Nv - An early draft settlement between the nation's major banks and U.S. states over deceptive foreclosure practices has been sent to state officials for review.

Many home owners have lost their homes and will not benefit from the possible $1,800 check, assuming that the settlement is for $25 billion dollars, that will show up by mail. 750,000 people would be likely to receive a check. That is not the surprising part.

The surprising part about this settlement is how it just might re-form the mortgage guidelines for good. This could make it easier for those at risk of foreclosure to restructure their loans. Roughly 1 million homeowners could see the size of the mortgage become lowered.

Five major banks - Bank of America, JPMorgan Chase, Wells Fargo, Citibank and Ally Financial - and U.S. state attorneys general could adopt the agreement within weeks, according to two officials briefed on the discussions. They spoke on condition of anonymity because they are not authorized to discuss the agreement publicly.

Our current President Barack Obama will address this issue in his 2012 State of the Union Address on the 24th of January.

The settlement would only apply to privately held mortgages issued between 2008 and 2011, not those held by government-controlled Fannie Mae or Freddie Mac. Fannie and Freddie own about half of all U.S. mortgages, roughly about 31 million U.S. home loans.

As part of the deal, about 1 million homeowners could also get the principal amount of their mortgages written down by an average of $20,000. One in four homeowners with a mortgage - or roughly 11 million people - owe more than their home is worth. These so-called "underwater" borrowers have little chance at refinancing.

Democratic attorneys general are meeting Monday in Chicago to discuss the deal with Housing and Urban Development Secretary Shaun Donovan. Republican attorneys general will be briefed about the deals via conference call later in the day.

Under the deal:

- $17 billion would go toward reducing the principal that struggling homeowners owe on their mortgages.

- $5 billion would be placed in a reserve account for various state and federal programs; a portion of that money would cover the $1,800 checks sent to those homeowners affected by the deceptive practices.

- About $3 billion would to help homeowners refinance at 5.25 percent.

Negotiations have been dragging on for more than a year over fraudulent foreclosure practices that drove millions of Americans from their homes during the housing crisis.

In October 2010, major banks temporarily suspended foreclosures following revelations of widespread deceptive foreclosure practices by banks. Discussions then began over a national settlement.

But some states have disagreed over what terms to offer the banks. In September, California announced it would not agree to a settlement over foreclosure abuses that state and federal officials have been working on for more than a year.

New York, Delaware, Nevada and Massachusetts, which sued five major banks earlier in December over deceptive foreclosure practices, have also argued that banks should not be protected from future civil liability. The deal will not fully release banks from future criminal lawsuits by individual states.

And both sides have also fought over the amounts of money that should be placed in the reserve account for property owners who were improperly foreclosed upon. Many of the larger points of the deal, including a $25 billion cost for the banks, have long been worked out, officials say.

Last month the Las Vegas City Council passed a Home Upkeep Ordinance to all Lenders that requires lenders to upkeep their properties on foreclosed homes in holding, or face some pretty steep penalties. So far the last 2 months in Las Vegas has brought some amazing changes to the once "Worst Housing Market ANYWHERE".