Independent Foreclosure Review: Borrowers to Get ‘Payments & Correspondence’ in March


Independent Foreclosure Review: Borrowers to Get 'Payments & Correspondence' in MarchRegulators provided a bit more detail today on settlement compensation for up to 4.2 million borrowers that were victims of improper foreclosures in 2009 and 2010.

The “Independent Foreclosure Review” settlement’s paying agent “will send payments and correspondence” by the end of March, or within the next four weeks.

The paying agent is Rust Consulting, Inc.

But borrowers still don’t know the precise payment structure, except that the types of errors that occurred in foreclosures will place those eligible in 11 basic groups, covering wrongdoing from relatively minor to the very egregious.

Compensation ranges from hundreds of dollars up to $125,000.

U.S. bank regulators overseeing the $9.3 settlement reached in January today released amendments to their enforcement actions against 13 mortgage servicers “for deficient practices in mortgage loan servicing and foreclosure processing.”

The amendments officially require the servicers to provide $9.3 billion in payments and other assistance to borrowers, as previously announced.

The amendments “memorialize” agreements in principle announced in January with Aurora, Bank of America, Citibank, Goldman Sachs, HSBC, JPMorgan Chase, MetLife Bank, Morgan Stanley, PNC, Sovereign, SunTrust, U.S. Bank, and Wells Fargo.

The amount includes $3.6 billion in cash payments and $5.7 billion in other assistance to borrowers, such as loan modifications and forgiveness of deficiency judgments.

Borrowers covered by the amendments include 4.2 million homeowners whose homes were in any stage of the foreclosure process in 2009 or 2010, and whose mortgages were serviced by one of these companies.

Borrowers are not required to take any additional steps to receive the payments.  In addition, borrowers will not be required to execute a waiver of any legal claims they may have against their servicer as a condition for receiving payment.

Borrowers can call the Paying Agent at 1-888-952-9105 to update their contact information or to verify that they are covered by the amendments.

The Office of the Comptroller of the Currency (OCC) said borrowers seeking assistance should work directly with their servicer or a counselor approved by the U.S. Department of Housing and Urban Development (HUD).  Borrowers can reach HUD-approved counselors by calling 888-995-HOPE (4673).

OCC and Federal Reserve said: “examiners continue to monitor the servicers’ implementation of corrective actions required by the original enforcement actions to address unsafe and unsound mortgage servicing and foreclosure practices.”

Here are the consent order amendments released today:


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24 Responses to “Independent Foreclosure Review: Borrowers to Get ‘Payments & Correspondence’ in March”

  1. bg says:

    Thanks for the article. So, I do have a question if anyone out there that speaks legalese can answer. Do the consent orders in essence give the bank the right to categorize the harm done (if any) to those who were foreclosed upon? Wasn’t one of the points of the Independent Foreclosure program to validate that the banks internal records were correct (i.e. not tampered with). If the bank is allowed to determine it’s own errors, that seems ‘off’ to me.
    Also, one of the benefits of the original Independent Foreclosure Review was that if there was evidence of any type of wrongdoing, and/or financial harm, the foreclosure would be removed from credit reports; this is worth a whole lot more to me than anything else, and it appears that the specific repair of credit was stripped out of this agreement. Is that correct, or am I incorrect?

  2. km says:

    Dido…… from the above statement. Long story short, my husband lost an eye. Out of work for four months. His name was the only one on mortgage, not mine but after numerous attempts to try and get help. We were told no, no, no. Rather than a few hundred dollar slap in the face we would rather have decent credit back. Like I said my name wasn’t on the lein but we were told both of our credit history would suffer tremendosly. And trust me it has been awful since we were foreclosed on. We were treated horribly by the reps and literally one girl laughed and told me there would never be any help for us. I guess in a nutshell she was right then, and she is right now.

  3. Jeff says:

    These consent orders do no good in court. I have used them. In them the banks neither admit or deny the claims within. This is smoke and mirrors and the OCC saying you can take your servicer to court is true, but your case will never survive a Motion to Dismiss. This is why the independent pay agent is used. The correct thing to do is to sue the OCC and the Treasury in the US District court if you disagree with your settlement. This is very expensive even if you know how to do this yourself. I am not an attorney but have taken my bank and Freddie mac to court and they courts are finding for the banks almost 100%

  4. sb says:

    This is an example of how the money will be distributed…

    It took me about 20min to juggle the numbers, it will take OCC two to create the spin that the consumers are not being screwed…

    Category Number Affected Amout Total Payments in Category
    0 1000 $150,000.00 $150,000,000.00
    1 6000 $125,000.00 $750,000,000.00
    2 10000 $60,000.00 $600,000,000.00
    3 20000 $15,000.00 $300,000,000.00
    4 48000 $5,000.00 $240,000,000.00
    5 64000 $3,000.00 $192,000,000.00
    6 88000 $2,000.00 $176,000,000.00
    7 124000 $1,000.00 $124,000,000.00
    8 240000 $750.00 $180,000,000.00
    9 350000 $500.00 $175,000,000.00
    10 3250000 $250.00 $812,500,000.00
    Total: 4200000 $3,549,500,000.00

  5. Melissa says:

    SB,

    Could you explain your chart a little more. Trying to figure out the pay out myself. Thanks.

  6. Kate says:

    Too funny……..

  7. sb says:

    It is just a simple spreadsheet that followed the remediation framework’s (http://www.occ.gov/topics/consumer-protection/foreclosure-prevention/financial-remediation-framework.pdf ) levels and assigned some arbitrary number representing how many borrowers that were affected. and then is is just a matter of fudging the amounts & borrowers to make the #borrowers= 4.2 million and payout = 3.6billion. Believe me, this is what the OCC and FED are doing right now. The question will be if they divide the money based on perceived harm or go for the simple route of giving everyone beside the military covered under SCRA the same amount.

  8. Kate says:

    Well i hope they catagorize by harm because i was protected by bankruptcy and my loan was sold to boa and they had a sheriff sale on my home with me not having any knowledge. So i ended paying over $3000 for atty to save my home and if course u end up paying about $500.00 more per month ontop of orig loan amount. So my atty had no idea nor me that my house was sold at sheriff sale. Too funny. On top of everything i got a letter from boa they would pay me $3000.00 to be out in 30 days if property was in broom swept condition….. Lmao. I had no time for that i have 5 kids two with autism and couldnt find anyone to rent to me. We ended up with my kids at my brothers place and i stayed with my bf’s family for 6 mos until i found a place. I always felt like i was delt a bad hand but because my husband died right before the sheriff sale i gave up on fighting for anything. You cant trust the banks to do the right thing and its a damn shame what happened to the service men that were foreclosed upon! They do deserve the top payouts. Im thinking im getting $250.00 cuz thats the luck i have! God bless everyone who delt with boa.

  9. Zan says:

    I got a card from Rust Consulting today saying that I was eligible for a payment but it didn’t state how much. I was told that when you receive the card it would let you know about the payment. It also said that a check or paperwork asking for add’l information will be sent in 4-8 weeks. I think that this a another stalling tactic to screw people out of what they owe them. Why can’t they just admit that they were wrong and tell you how much you will get. They are already going to give you a fraction of what you are suppose to get or maybe they are trying not to give you anything all.

  10. Pam says:

    I got my card today also with the same lack of information The Banks win again… I will not have my Hopes knocked down again Will
    rely on myself and move forward from this Nightmare that has lasted Four years, Good Luck to all!!

  11. lisa langford says:

    we too received our you are ligible card. I am wondering what and when too. Citimortgage decided a few years ago to start an escrow on our account without our knowledge and while we were paying our own insurance and taxes. (they bought the loan from the original creditor) and it has been nothing but headache since. It took us three years of attorneys and motions and orders to even get them to take us serious. A FEDERAL judge issued an order saying we did not owe anything and our mortgage was current and they refused to follow a FEDERAL judges orders. So now all these nasty cheatin’ banks have to do is shell out money and its home free to do it all again?

  12. Rick says:

    .
    I also received my little post card today. It didn’t have much info on it besides saying we will have a check or correspondence within 4 to 8 weeks. I think we will only get some type of paperwork to stall payment in 4 to 8 weeks and then who knows when the check will arrive. Either way whatever it is. I don’t think it will be much, maybe $800 and It won’t make up for what we lost. 10 yrs of payments including our down payment of $50,000 and $40,000 of upgrades into the home not to mention all of the stress and embarrassment. etc.

    Good Luck Everyone!

  13. anthony says:

    Here is the good & bad news.

    Good news, all of us who filled out the paperwork & received our letters fro Rust Consulting will be getting much larger checks than we originally expected.
    Bad news. Only 2% of the 4.3M americans took the time to fill out the paperwork!! Can you believe that??

  14. Molly says:

    Uncle Sam of course, will want his percentage of whatever the amount is!!! Of course.

  15. goldie p says:

    I also recieved the post card, it seems like a little bit of hope for us All American Families who just try to make it. Feeding our children anymore is a struggle we made $28 too much for public assistance too so this really means alot but on the other hand the banks and government always seem to weezle their way out of any hope that we as people may hold.

  16. Kevin says:

    I received a post card also. Believe it or not I have a funny feeling we are going to receive more than we anticipate. But what do I kno I lost my house lol

  17. Pamela says:

    I agree Kevin! I have faith that we are going to get our life back. Praying that we can move on!

  18. Thalia says:

    I received my post card as well! I am not holding my breathe. But deep down We seem to be getting the same run around that we were getting when we were trying to hold on to our homes.

  19. laura says:

    the nice folks a chase made us resubmit & resubmit & resubmit our papers over and over and over and over, it was horrible one told me that because I didn’t cross my “t” they couldn’t accept our papers to try to save our house, we lived in it for over twenty years!

  20. Nancy says:

    I had called in after the deadline for the review paperwork and was told they didn’t have me on file but I received a postcard. So I’m not sure how the people who didn’t file the paperwork will come out? It’s ridiculous that they say they are so close to sending the payments but can’t give people an amount. It just seems like a game of toying with people and torturing them a little more.

  21. RacheK says:

    Hmmm. Here it is April 1st and those infamous checks/pay-outs are coming due starting this month. I am so curious to see what our compensation will be. By all means it will not be enough to re-coup our losses. God Bless each and everyone of you living this nightmarish saga!

  22. RA says:

    I got my settlement check today. It was $500.00. I sent in for the foreclosure review which made my payment double. The check had a letter attached to it that would make an attorney blush. I was on a forbearance plan for 3 months and the bank called me to make the first payment, which I made. The bank then foreclosed and their attorneys tried to contact me to give me back the first payment so the foreclosure would be good. I made sure I did not get the $500.00 payment back from their attorneys, which the bank wanted immediately ( I sent the payment by western union). So now I guess the bank is happy to send me the $500.00 through Rust, which makes it okay. My bank gutted me for $18,000 and I have the $500.00 I am not surprised in that I knew I would get got again, but I have a strong feeling that this is not the end of what the banks did to homeowners.

  23. Laura says:

    Oh how offensive that 500.00 dollar check they sent me!… Yup keep hardworking ppl in debt.. And ya the big money will go to ppl who probably have no rights to it.. Thanks for my shit credit and loss of a home.. All for 500.00 sickening

  24. jerry says:

    I received a postcard in April of 2013 from the IFR, stating I was one of the claiment who was gonna received a payment fromRust consultent agency. I called the number on the card back in April. I was told that my check was mailed on the first wave which was April 12,2013. I still have’nt got the check today. I been calling them since May of 2013 all I get is the same answer from there office it’s will mailed be out what can i do.

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