$5.8M Nationstar Mortgage servicing class action settlement

Nationstar Mortgage agreed to pay $5.8 million to resolve claims it violated mortgage servicing laws, costing some borrowers to lose their homes to foreclosure.

The Nationstar settlement benefits two groups of affected homeowners: the service transfer population and the property preservation population.

The service transfer population includes borrowers whose loans were transferred in bulk to Nationstar for servicing between Feb. 1, 2011, and Dec. 18, 2017, whose loans became 30 days delinquent within 90 days of the service transfer and whose delinquency resulted in foreclosure.

The property preservation population includes borrowers whose property was subject to a Nationstar inspection, determined to be vacant and had the lock changed between June 24, 2011, and Dec. 29, 2017, where the borrower requested access to the property within 30 days of the initial lock change or the property was reported as occupied through a subsequent inspection within 90 days of the initial lock change.

According to claims from state attorneys and mortgage regulators, Nationstar violated the law by committing numerous service errors and abuses. These alleged illegal Nationstar Mortgage servicing actions reportedly caused financial harm to borrowers with some homeowners even losing their homes.

Nationstar Mortgage d/b/a Mr. Cooper is a mortgage company that offers home loans, refinancing and other mortgage services.

Nationstar reached the $5.8 million settlement with the attorneys general and mortgage regulators from 50 states. The mortgage-servicing company agreed to similar settlements in the past, including an ACH settlement and a convenience fee settlement.

Under the terms of the Nationstar settlement, borrowers may be eligible for a cash payment based on which settlement group they qualify for.

Borrowers who lost their homes to foreclosure as part of the service transfer population may be eligible for a cash payment to remedy the reduction in proceeds deemed realized by borrowers for tax purposes from the foreclosure sale of their residential properties.

Borrowers in the property preservation population may be eligible for a cash payment to reimburse them for expenses incurred as a result of being locked out of their homes.

The settlement website does not include payment estimates though class members may have received a minimum payment estimate in the second sentence of the letter they received informing them of the settlement. Actual payments may be larger than this amount but will not be less.

There was no exclusion or objection deadline for the settlement.

The Nationstar Mortgage servicing settlement was finalized with a consent judgment on Dec. 8, 2020.

The deadline for borrowers to submit a claim form is March 3, 2025.

Who’s Eligible

Borrowers whose loans were transferred in bulk to Nationstar for servicing between Feb. 1, 2011, and Dec. 18, 2017, that became 30 days delinquent within 90 days of the service transfer and whose delinquency subsequently resulted in dispossession of the property in foreclosure.

Borrowers whose property was subject to a property inspection by Nationstar or its agent and determined to be vacant and, as a result of that determination, Nationstar or its agent changed the lock on the property between June 24, 2011, and Dec. 29, 2017, and either within 30 days of the initial lock change the borrower requested access to the property or within 90 days of the initial lock change the property was reported as occupied through a subsequent inspection.

Potential Award

TBD

Proof of Purchase

N/A

Claim Form Deadline

03/03/2025

Case Name

The State of Alabama, et al. v. Nationstar Mortgage LLC d/b/a Mr. Cooper, Case No. 1:20-cv-03551, in the U.S. District Court for the District of Columbia

Final Hearing

12/08/2020

Settlement Website

NationalNationstarSettlement.com

Claims Administrator

866-404-0137

Class Counsel

Olivia Martin
OFFICE OF THE ALABAMA ATTORNEY GENERAL

Ian Engelbeck
ALASKA DEPARTMENT OF LAW

Matthew du Mee
ARIZONA ATTORNEY GENERAL’S OFFICE

Johnathan R Carter
ARKANSAS ATTORNEY GENERAL’S OFFICE

Tina Charoenpong
OFFICE OF THE CALIFORNIA ATTORNEY GENERAL

Jennifer Miner Dethmers
COLORADO DEPARTMENT OF LAW

Joseph Chambers
CONNECTICUT OFFICE OF THE ATTORNEY GENERAL

Michael Clarke
DELAWARE DEPARTMENT OF JUSTICE

Benjamin Wiseman
OFFICE OF THE ATTORNEY GENERAL FOR THE DISTRICT OF COLUMBIA

Sasha Funk Granai
OFFICE OF THE ATTORNEY GENERAL FOR THE STATE OF FLORIDA

Alkesh Patel
GEORGIA DEPARTMENT OF LAW

James C Paige
HAWAII DEPARTMENT OF THE ATTORNEY GENERAL

Stephanie Guyon
IDAHO ATTORNEY GENERAL’S OFFICE

Andrew Dougherty
ILLINOIS ATTORNEY GENERAL’S OFFICE

Scott Barnhart
INDIANA ATTORNEY GENERAL’S OFFICE

Patrick Madigan
IOWA ATTORNEY GENERAL’S OFFICE

Kate Carter
KANSAS ATTORNEY GENERAL’S OFFICE

Don Rodgers
KENTUCKY ATTORNEY GENERAL’S OFFICE

Arham Mughal
LOUISIANA DEPARTMENT OF JUSTICE

Linda Conti
MAINE ATTORNEY GENERAL’S OFFICE

Shelly M. Martin
MARYLAND OFFICE OF THE ATTORNEY GENERAL

Michael Lecaroz
MASSACHUSETTS ATTORNEY GENERAL’S OFFICE

Kathy Fitzgerald
MICHIGAN ATTORNEY GENERAL’S OFFICE

Caitlin Micko
MINNESOTA ATTORNEY GENERAL’S OFFICE

Seth Shannon
MISSISSIPPI ATTORNEY GENERAL’S OFFICE

Michael Schwalbert
MISSOURI ATTORNEY GENERAL’S OFFICE

Chuck Munson
MONTANA DEPARTMENT OF JUSTICE

Jocelyn Brasher
NEBRASKA ATTORNEY GENERAL’S OFFICE

Sheri Ann Forbes
NEVADA ATTORNEY GENERAL’S OFFICE

Robert F Adams
NEW HAMPSHIRE DEPARTMENT OF JUSTICE

Donna J Dorgan
NEW JERSEY DIVISION OF LAW

Lisa Giandomenico
NEW MEXICO OFFICE OF THE ATTORNEY GENERAL

Jane M Azia
NEW YORK STATE ATTORNEY GENERAL’S OFFICE

Keith Clayton
NORTH CAROLINA DEPARTMENT OF JUSTICE

Parrell D Grossman
NORTH DAKOTA OFFICE OF THE ATTORNEY GENERAL

Tracy Morrison Dickens
OHIO ATTORNEY GENERAL’S OFFICE

Malisa McPherson
OKLAHOMA OFFICE OF THE ATTORNEY GENERAL

Althea Cullen
OREGON DEPARTMENT OF JUSTICE

Nicholas F B Smyth
PENNSYLVANIA OFFICE OF ATTORNEY GENERAL

David Marzilli
RHODE ISLAND OFFICE OF THE ATTORNEY GENERAL

Jared Q Libet
SOUTH CAROLINA ATTORNEY GENERAL’S OFFICE

Philip D Carlson
SOUTH DAKOTA ATTORNEY GENERAL’S OFFICE

Travis Brown
TENNESSEE ATTORNEY GENERAL’S OFFICE

Richard L Bischoff
TEXAS ATTORNEY GENERAL’S OFFICE

Sean D Reyes
OFFICE OF THE UTAH ATTORNEY GENERAL

James Layman
VERMONT ATTORNEY GENERAL’S OFFICE

Tanya L. Godfrey
WEST VIRGINIA ATTORNEY GENERAL’S OFFICE

Colin R Stroud
WISCONSIN DEPARTMENT OF JUSTICE

Benjamin M Burningham
WYOMING ATTORNEY GENERAL’S OFFICE

Defense Counsel

N/A