Consumer group tentatively backs foreclosure settlement backed The Center for Responsible Lending has called a proposed $25-billion settlement over faulty foreclosure practices between attorneys general, federal agencies and the mortgage industry "an important step forward in addressing foreclosure abuses." The Washington-based consumer group, which has a strong California presence, called the proposed deal "not perfect" but one that would "provide an important template for ways banks can use principal reduction to reduce unnecessary foreclosures and put the country back on a path to economic recovery." Principal reduction is the writing down of mortgage debt so that homes that are "underwater" become more attractive and affordable for troubled homeowners to stay in. The settlement would include a principal reduction element that could write down the mortgage debt of certain homeowners by an average of $20,000. Some activists, including MoveOn.org, and consumer groups have been skeptical of the deal because of concerns by certain attorneys general -- most vociferously Eric Schneiderman of New York -- that the banks were asking for too much release from liability. California's Kamala D. Harris also walked away from negotiations with the banks because of her concern that the banks were asking for too much release from liability in exchange for too little for the state's homeowners. People familiar with the negotiations hoping to get Harris onboard have insisted that the terms of the deal would only block certain claims, namely origination and servicing, from going forward. The center appeared to echo those arguments, writing, "the settlement would preserve the ability of homeowners to pursue claims against banks." The center has not reviewed the draft proposal of the $25-billion deal, which has not been made public but has been described to media outlets, including the Los Angeles Times, by people familiar with the deal. In giving the deal its qualified endorsement, the consumer group noted that the settlement would end robo-signing as well as many servicing abuses, make for more sustainable loan modifications and keep banks accountable. The Obama administration has been working for months to try to speed up the deal (Housing and Urban Development Secretary Shaun Donovan last summer told The Times a deal was imminent in "a matter of weeks"). The New York Times reported that Obama was hoping to have a deal inked by Tuesday night so he could tout it in his State of the Union address. But some analysts, including journalist Harold Meyerson, writing for The Times in an op-ed last year, have noted that more local concerns may also be weighing on Harris" decision. "To settle would mean putting at risk the support of the liberal constituencies whose interests she championed as San Francisco's district attorney," Meyerson wrote. They backed her in her run for attorney general, and she'll need their support if she runs for governor or U.S. senator later this decade. The Center for Responsible Lending is clearly important for Harris. California Director Paul Leonard stood next to Harris when she traveled to Los Angeles last May to announce that she was creating a Mortgage Fraud Strike Force to investigate foreclosure and other abuses in the Golden State. [Updated 2:36 p.m., Jan. 24: Despite the tentative thumbs-up by his organization, Leonard, in an interview with The Times on Tuesday, would not call on Harris to sign onto the deal. "Harris will have to make that decision for herself," he said. "She has clearly been a strong and principled leader on foreclosure issues ... she will make a decision to do what is best for the borrowers and mortgage market of California."] Specific details of how California would fare under the draft settlement have not been made public or described to The Times.