BECKHAM
09-04-2013, 07:22 PM
Payments to 4.2 million mortgage borrowers are scheduled to begin Friday under an agreement this year between federal banking regulators and 13 companies that service home loans.
The agreement emerged from the government's investigation of the so-called robo-signing scandal, when mortgage services launched foreclosures without thoroughly checking supporting documents.
The settlement provides $3.6 billion in cash payments to borrowers whose homes were in any stage of foreclosure in 2009 or 2010 and whose mortgages were serviced by one of the companies. The payments will range from $300 to $125,000 depending on how much a borrower was harmed by a mortgage servicer's errors.
The participating companies are Aurora, Bank of America, Citibank, Goldman Sachs, HSBC, JPMorgan Chase, MetLife Bank, Morgan Stanley, PNC, Sovereign, SunTrust, U.S. Bank, and Wells Fargo.
The first wave of 1.4 million checks will go out Friday, the Office of the Comptroller of the Currency said Tuesday. The final wave is expected in mid-July. The timing of payments to borrowers whose mortgages were serviced by Goldman Sachs and Morgan Stanley is still to be determined.
In most cases, borrowers will receive a letter with an enclosed check sent by Rust Consulting, which is an agent hired to handle the payments. Some borrowers may receive letters from Rust seeking more information to process their payments. Last month, Rust sent postcards to the 4.2 million borrowers notifying them of their eligibility.
Rust is sending all payments and correspondence regarding the foreclosure agreement at the direction of the OCC and the Federal Reserve.
Borrowers can call Rust at chrome://skype_ff_extension/skin/numbers_button_skype_logo.png1-888-952-9105 to update their contact information or to verify that they are covered by the agreement.
Accepting a payment will not prevent borrowers from taking any action they may wish to pursue related to their foreclosure.
The payments result from a revised agreement between the OCC and the Federal Reserve and the servicing companies stemming from alleged errors in processing foreclosure cases. Initially, the regulators required the servicers to review files, case by case, to determine harm. That process was scrapped after it was deemed too slow and costly.
In determining the payment amounts, borrowers were categorized according to how far their foreclosure case progressed and the type of possible servicer error. Regulators then determined amounts for each category.
Three companies did not join the new settlement. Their individual case reviews are ongoing. Those companies are OneWest, Everbank, and GMAC Mortgage.
The agreement emerged from the government's investigation of the so-called robo-signing scandal, when mortgage services launched foreclosures without thoroughly checking supporting documents.
The settlement provides $3.6 billion in cash payments to borrowers whose homes were in any stage of foreclosure in 2009 or 2010 and whose mortgages were serviced by one of the companies. The payments will range from $300 to $125,000 depending on how much a borrower was harmed by a mortgage servicer's errors.
The participating companies are Aurora, Bank of America, Citibank, Goldman Sachs, HSBC, JPMorgan Chase, MetLife Bank, Morgan Stanley, PNC, Sovereign, SunTrust, U.S. Bank, and Wells Fargo.
The first wave of 1.4 million checks will go out Friday, the Office of the Comptroller of the Currency said Tuesday. The final wave is expected in mid-July. The timing of payments to borrowers whose mortgages were serviced by Goldman Sachs and Morgan Stanley is still to be determined.
In most cases, borrowers will receive a letter with an enclosed check sent by Rust Consulting, which is an agent hired to handle the payments. Some borrowers may receive letters from Rust seeking more information to process their payments. Last month, Rust sent postcards to the 4.2 million borrowers notifying them of their eligibility.
Rust is sending all payments and correspondence regarding the foreclosure agreement at the direction of the OCC and the Federal Reserve.
Borrowers can call Rust at chrome://skype_ff_extension/skin/numbers_button_skype_logo.png1-888-952-9105 to update their contact information or to verify that they are covered by the agreement.
Accepting a payment will not prevent borrowers from taking any action they may wish to pursue related to their foreclosure.
The payments result from a revised agreement between the OCC and the Federal Reserve and the servicing companies stemming from alleged errors in processing foreclosure cases. Initially, the regulators required the servicers to review files, case by case, to determine harm. That process was scrapped after it was deemed too slow and costly.
In determining the payment amounts, borrowers were categorized according to how far their foreclosure case progressed and the type of possible servicer error. Regulators then determined amounts for each category.
Three companies did not join the new settlement. Their individual case reviews are ongoing. Those companies are OneWest, Everbank, and GMAC Mortgage.