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Banks to Pay $9.3 Billion in Foreclosure Abuse Settlement
By Sarah Pierce
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UPDATE: Payments in the Bank Foreclosure Abuse Settlement will begin April 12, 2013. Millions of borrowers can expect to receive a check in the mail by the end of the month.
Thirteen banks will pay a total of $9.3 billion to settle federal charges they engaged in foreclosure abuse during the U.S. housing crisis. Borrowers whose mortgages were serviced by one of the banks can expect to receive between a few hundred dollars and $125,000 from the settlement.
The Office of the Comptroller of the Currency (OCC) and the Federal Reserve announced the final mortgage abuse settlement Thursday, which includes Aurora, Bank of America, Citibank, Goldman Sachs, HSBC, JPMorgan Chase, MetLife Bank, Morgan Stanley, PNC, Sovereign, SunTrust, U.S. Bank, and Wells Fargo.
The federal agencies accuse the banks of engaging in improper foreclosure methods in 2009 and 2010 that included wrongful denial of modifications, improper fees, flawed mortgage servicing and processing practices, and robo-signing – the process of rapidly approving numerous foreclosures and submitting them to courts without having read them to determine if they were proper.
Rust Consulting Inc., which specializes in class action settlement administration, will handle distribution of the funds and is expected to contact affected homeowners by the end of March. Eligible foreclosed borrowers will start receiving payments in April from a $3.6 billion fund. The remaining money will go to struggling borrowers in the form of assistance, including loan modifications and forgiveness.
Over 4 million people whose homes were in any stage of foreclosure in 2009 or 2010 and whose mortgages were handled by one of the 13 mortgage services will be covered by the foreclosure abuse settlement. These borrowers will not need to take any action to receive their payments, nor will they have to waive their legal rights to sue the banks as a condition for payment, according to reports.
Top Class Actions will provide further details on the Bank Foreclosure Abuse Settlement once official notice of the deal is published.
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Updated April 10th, 2013
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All class action and lawsuit news updates are listed in the Lawsuit News section of Top Class Actions
72 thoughts onBanks to Pay $9.3 Billion in Foreclosure Abuse Settlement
http://www.latimes.com/business/money/la-fi-mo-foreclosure-settlement-20130409,0,471582.story
Looks like most checks will be for about $300.
I just went on the OCC and Federal Reserve website and it has been updated stating that checks will be sent out starting April 12 and payment detail are also on the website.
Best of Lucks to everyone. Hopefully We ALL received a BIG CHECK
were we required to submit a claim for both this one and National mortgage or are they both along the same lines if u were involved with one of the banks included in the suit? Countrywide/BOA was my lender.
The settlement is only for borrowers whose mortgages were financed with the banks that were sued.
Does anyone know who to contact if I didn’t receive a notice of payment? I had HSBC as the holder of my mortgage and it was serviced by American Home Mortgage. They wouldn’t work with me in 2009 – 2011 to adjust my rate after jumping through all the hoops. Was told HSBC was not an American held bank and was not participating in Obamas plan to help people. House went thru forclosure in 2011.
Thanks
I have research and learned whats going on. I have checked sites daily and read everything there is and it all sounds the same, nothing but pocket change for us and NO Justice. I have fought BOA for years and all they do is cheat people out of anything they can. Have you had to deal with these banks first hand like us fighting for your home?
Star, the settlement referred to in this posting is not relating to the National Mortgage Settlement. This is in reference to the OCC settlement that was agreed on in January. The one you are referring to is The National Mortgage Settlement closed in January and you had to file a claim. For people whose homes were foreclosed on and were not Fannie Mae or Freddie Mac will get a check for at least $840. However, unofficial numbers that have trickled out indicate that only about 50 percent of the people who were eligible filed a claim so I would say people who are eligible should get a check for around $1,700 in the next 3-4 months. Regarding the settlement listed on this posting, people who are eligible will get between a few hundred dollars up to $125K. This is being administered by Rust Consulting and you may have gotten a postcard in the mail about this. You do not have to do anything to get this money if you are eligible and you do not have to file a claim. The postcard that was sent out on March 18 indicated that either a check or request for more information would be coming within the next four to eight weeks. Unofficial rumor is that the people who will be getting less than $700 will get a check and the ones who are getting more than $700 will be getting tax paperwork to fill out so that at the end of the year 1099’s can be issued. That’s the tax issue. Those checks will take a bit longer to send out as they HAVE to have comply with tax law. Unofficially I have read that the slots that determine how much money you will get follow along these lines. a) military people who were wrongly foreclosed on will get the most, b) people who actually lost their homes are next in line, c) people who are still living in their homes will get the smaller amounts. Many people will benefit from both of these programs. Yes, it’s not perfect, but it’s something. And BOTH of these settlements do not prevent you from going forward and filing your own claim even if you participate in both of these settlements. So again, before you blow gaskets and start screaming — research and learn what is going on.
This settlement is a Big Joke! and not in a funny way…2yrs of pure hell and we will get 857 each…Who got Justice here? Not us that’s for sure…This is not a Victory..we still got cheated. There is No Justice for all
I had my home with Countrywide/BofA. Problems stated with BofA with loss of income caused me to fall behind (medical problems). I requested to modify the loan and 3 days later they started forclosure proceedings. Then when the govenment came out with new assistance programs they stopped the foreclosure and modified. They charged me $2300 and my payment went down $2.00 a month! Some help that was. Then I requested a short and they agreed. The house was listed and we had three viable offers that they realtor sent in. One BofA received the offers they said I did not qualify for a short sale! Then, we tried Deed in Liu of Foreclosure. They had 3 months to approve/disapprove. In the last week they notified me that they disapproved it and I had to scramble to find a place to move my family of five. It was 2 years of a nightmare. I never want to own a home again!
Bank of America done everything except take my home through forecloruse.I went through a lot of stress and anxioey.I think that i should get some of the moneyfrom this settlement.Bank of America is a bad company to do business with.