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Additional Checks Being Mailed to Borrowers in Bank Foreclosure Abuse Settlement
By Sarah Pierce
Three days after reporting that homeowners were upset at how small their checks were from the bank foreclosure abuse settlement comes news that the Federal Reserve is ordering additional checks to be sent to some 96,000 borrowers to correct errors made in the initial payment.
The Federal Reserve announced yesterday that the initial compensation amounts these borrowers received were too low due to errors made by the settlement administrator, Rust Consulting.
“As Rust Consulting has announced, approximately 96,000 borrowers whose loans were serviced by the former subsidiaries of Goldman Sachs (Litton Loan Servicing LP) and Morgan Stanley (Saxon Mortgage Services, Inc.) were sent checks for less than the payment amount that the Federal Reserve directed Rust to pay. The new checks will make up the difference between what was in the original check sent by Rust and what should have been paid. Borrowers should cash both the original checks and the supplemental checks,” the Federal Reserve said in an announcement released yesterday.
The Federal Reserve Board became aware of the discrepancies on Tuesday and immediately contacted Rust Consulting to assess the problem, they said.
The supplemental checks will be sent around May 17.
The Federal Reserve said it will continue to closely monitor the payment agreement and Rust’s work in distributing the checks to ensure there are no additional errors.
The checks are part of a $9.3 billion settlement reached with 13 banks over abusive foreclosure practices that occurred in 2009 and 2010.
Updated May 9th, 2013
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11 thoughts onAdditional Checks Being Mailed to Borrowers in Bank Foreclosure Abuse Settlement
ya, I just got a check for $2.86. Big deal. They shoulda just kept it. It’s not right