WASHINGTON -- Despite continued distress in the housing market and gridlock on Capitol Hill, it looks like struggling homeowners will be getting a little more help in the months ahead.

Under the settlement, servicers will provide cash for victims, fund billions of dollars in mortgage write-downs for underwater homeowners and agree to new guidelines for mortgage servicing designed to prevent future abuses.
The government has filed a $25 billion settlement with the five largest mortgage lenders in federal court, putting an official stamp on the landmark agreement announced last month over alleged foreclosure abuses.

The banks agreed to provide $20 billion in relief to struggling homeowners, including $17 billion to reduce the amount of principal owed on their mortgages. On top of that, $3 billion will go to refinance the mortgages of homeowners who are current on their payments but owe more than their homes are worth.

The bulk of the settlement is focused on helping stabilize the housing market.