Foreclosure Settlement Payments Range from $300 up to $125,000

by devteam April 10th, 2013 | Share

Homeowner beneficiaries of the recentrnsettlement agreement made by the Comptroller of the Currency (OCC) and the FederalrnReserve Board with 13 mortgage servicers can expect to begin receiving paymentsrnnext week.  The agreement that ended thernindependent foreclosure reviews mandated earlier by the Fed and OCC call for arntotal of $3.5 billion in cash payments to 4.2 million borrowers whose homesrnwere in any stage of foreclosure in 2009 or 2010 and serviced by one of the 13 banksrnor their subsidiaries.  </p

Initial payments will go out to customers of eleven of the servicers, Aurora,rnBank of America, Citibank, HSBC, JPMorgan Chase, MetLife Bank, PNC, Sovereign,rnSunTrust, U.S. Bank, and Wells Fargo. Payments will range from $300 to $125,000</band will be sent in several waves beginning with 1.4 million checks on Aprilrn12.  The final wave is expected in mid-July 2013.  More than 90rnpercent of the total payments to borrowers at those 11 servicers are expectedrnto have been sent by the end of April.  Those borrowers whose mortgagesrnwere serviced by Goldman Sachs and Morgan Stanley will receive informationrnabout their payments in the near future.  </p

In most cases, borrowers will receive a letter with an enclosed check sentrnby the Paying Agent-Rust Consulting, Inc.  Some borrowers may receivernletters from Rust requesting additional information needed to process theirrnpayments.  Previously, Rust sent postcards to the 4.2 million borrowersrnnotifying them of their eligibility to receive payment under the agreement.</p

Borrowers can call Rust at 1-888-952-9105 to update their contact informationrnor to verify that they are covered by the agreement.  Borrowers are warnedrnto beware of scams and anyone asking them to call a different number or to payrna fee to receive payment under the agreement.</p

Accepting a payment will not prevent borrowers from taking any action theyrnmay wish to pursue related to their foreclosure.  Servicers are notrnpermitted to ask borrowers to sign a waiver of any legal claims they may havernagainst their servicer in connection with accepting payment.</p

Payment amounts were determined by a formula which took into account thernstage of their foreclosure process and the type of possible servicer error.   Regulators have published the paymentrnamounts and number of people in each category on their Web sites at here</aand here.</p

While the agreement ended the Independent Foreclosure Review for the 13rncompanies identified above, the review continues for OneWest, Everbank, andrnGMAC Mortgage.  

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About the Author


Steven A Feinberg (@CPAsteve) of Appletree Business Services LLC, is a PASBA member accountant located in Londonderry, New Hampshire.

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