Mortgage buybacks could cost banks

New reports suggest that the biggest bills from the foreclosure crisis may be coming to banks rather than struggling consumers.

JP Morgan Chase and Bank of America are among the lenders facing between $54 billion and $106 billion in costs to repurchase faulty mortgage loans, Bloomberg reports. Mortgage underwriters are also facing huge losses as a result.

“We know this range is excessively wide and that most readers will circle the high end of the range as the most likely loss estimates for the industry,” Paul Miller, of FBR Capital Markets, told Bloomberg.

“Ultimately, we do not believe that losses will be as severe as many investors expect, and repurchase losses should be manageable even in our worst-case scenario.”

The resulting buybacks could have big ramifications within the banking industry as lenders would likely turn to consumers in order to recoup the lost revenue, the news source says.

While the overall affect this will have on the market will be unknown for some time, consumers struggling with debt may wish to compare refinance rates for existing mortgage loans in order to avoid foreclosure.