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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
Never received a big check but 2.35 wasn’t worth cashing. I missed one payment and I attempt at dat 17 to submit my payment I was denied and put in forclourse. I asked for modification that was sent to India and they kept saying I didn’t submit paperwork after I did several times this went on for 8 months then someone showed up and said I was getting foreclosed and thier there to take pictures I called they said they new nothing I resubmitted same paper a total of 11 times then I gave up and did a short sale lost my home. No check no reimbursement no anything.
Received check for $32,000. Thought I was getting $2000. What a surprise….doing my happy dance!
i felt it in my bones that this was going to be a joke. received $800 . was promised 2000 if i agreed to a short sale to help with moving expenses [which i did] was turned down for a loan modification after submitting the paperwork 4 times .rec’d notification 2 weeks prior to short sale and never rec’d 2000.
I’m glad someone is lookig at Rust thru same eyes as the bank was. I received $600.00 and felt so screwed again.
We haven’t even received our first check!!!!!!
lost house or so they told us in 09, we were 1 month behind sent that payment plus the month due and late charges this was in July, BOA verified this. Sept 09 they sent all back and told us to pay 10,000 fee that it was in foreclosure. Couldn’t get money, they refused to modify the loan even when we were able to pay. also told us to vacate or they’ll call sheriff, We are active duty
so, they are sending out additional checks to those borrowers who received little checks and were with saxon, litton etc? what about the rest of us?
We only received $600.00 and lost our down payment of $20,000 and 15 years worth of payments on our house. Our house was foreclosed on within days and had to move fast. We lost our house and our lives in exchange for $600.00. So sad! My stomach hurt when I saw I waited a year for a $600.00 check!! How does this help out a family of 4?????
Just another company trying to defraud consumers who have already been defrauded.
UNREAL!!!!
Rust consulting should be sued now..
This is really awesome! I only received $400 and was in the $800 category! I’ll cross my fingers!