On March 4th, the New York Times reported that state attorneys general have submitted to five of the largest banks a proposal addressing improper foreclosure practices. The proposal generally requires lenders to address each foreclosure individually. Foreclosure Proposal. On March 7th, Bloomberg provided additional details of the proposal. Details. On March 8th, the New York Times reported that Bank of America has responded to the proposal's provision requiring principal reductions for troubled borrowers who owe more than their house is worth. Bank of America's CEO Brian T. Moynihan noted such write-downs would be unfair to underwater borrowers who remain current on their mortgages. Moynihan also stated that investors in the securitized mortgages must be consulted. Response. On March 9th Reuters reported that Congressional representatives have written to Treasury Secretary Timothy Geithner, objecting to the proposal because it exceeds regulatory authority. Objections. On March 10th, Reuters reported that Wells Fargo CEO John Stumpf warned that principal reductions could have an adverse effect on Fannie Mae and Freddie Mac. Effect.