Up to nearly 4 million borrowers have started receiving payments as part of a $3.3 billion settlement fund stemming from the so-called Independent Foreclosure Review.
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The compensation range is from hundreds of dollars to $125,000.
Regulators have published the payment amounts and number of people in each category.
Since the settlement’s announcement two months ago, regulators have only said that the payouts would range from “hundreds of dollars up to $125,000” — the highest amount reserved for the most egregious cases of wrongful evictions.
Bryan Hubbard, Director, Public Affairs Operations for the Office of the Comptroller of the Currency (OCC), told eCreditDaily that the payout system would differ from one released last year that was tied at the time to the ongoing foreclosure reviews.
The settlement fund is earmarked for borrowers who were victims of improper foreclosure actions in 2009 and 2010. Consent orders dated Feb. 28 required 10 major lenders, including Bank of America, JPMorgan Chase, Wells Fargo and Citibank, to provide the funds this month for regulators to begin dispersing within weeks.
The settlement announced in January totals $9.3 billion involving 13 mortgage servicers. Consumer advocates have criticized the deal because it essentially ended independent reviews of mishandled or improper foreclosures, including wrongful evictions. The depth of the wrongdoing or mistakes by most lenders may never come to light, they say.
The eligible IFR borrowers have been receiving postcards in the mail since last week from Rust Consulting, the settlement’s official paying agent. The cards inform borrowers that they are eligible and that they would receive payments or other information in four to eight weeks.
“Payments are expected to start in April,” Hubbard said. He also said that the “qualified settlement fund” has been funded.