Two years after bank regulators took their initial “enforcement” action against mortgage servicers in the mostly-defunct Independent Foreclosure Review, checks to nearly 4 million eligible borrowers have started to arrive at mailboxes nationwide. But anger persists among the recipients of these checks — the vast majority amounting to hundreds of dollars each.

Borrowers Mull ‘Class Action’ as Foreclosure-Review Checks Arrive

Borrowers Mull ‘Class Action’ as Foreclosure-Review Checks Arrive

Borrowers Mull 'Class Action' as Foreclosure-Review Checks ArriveTwo years after bank regulators took their initial “enforcement” action against mortgage servicers in the mostly-defunct Independent Foreclosure Review, checks to nearly 4 million eligible borrowers have started to arrive at mailboxes nationwide.

But anger persists among the recipients of these checks — the vast majority amounting to hundreds of dollars each — representing payouts that fall vastly short when truly accounting for the wrongdoing by the named banks and their servicers, according to the borrowers, consumer advocates and some lawmakers.

Check recipients have taken to forums, social media and various news and blog sites (eCreditDaily included) urging each other to keep banding together and form class-action lawsuits against the banks.

At least one forum had registered nearly 600 IFR  borrowers, with many calling for legal action, by late afternoon Tuesday.

Thousands of checks were received Monday, and many more will be delivered this week.

Here are some comments from IFR check recipients –  from blogs, forums and Facebook pages where hundreds of foreclosure victims have congregated:

Matt: My check was $800…not nearly enough to make up for losing my home…

Julie: I got my check today – $500.00. My house went into foreclosure, I applied for a modification, never heard back – they basically ignored me. I had thought I would have fallen into the $6000 category, since they ignored my request.

Kylee: We received our check today; it was $400.00. We should have got $3,750.00. We were covered under Bankruptcy law. The home has been sitting vacant for almost 6 years.

SoCal: I received a check today for 6K. I was in the category that should of paid 50k. Class action time!!!!!

Another borrower said she received a check for $300.00 and was not able to deposit it. Her bank  informed her more than once that there was no money in the account.

Borrowers under the Independent Foreclosure Review settlement, reached with 13 mortgage servicers earlier this year, have the option to file lawsuits for rightful compensation — an action that will undoubtedly unfold over the next few months as checks continue to be mailed out by Rust Consulting, the paying agent for the regulators.

There is no IFR appeal process. Regulators have made that clear. “The payment amount is final,” both the Comptroller of the Currency and the Federal Reserve say on their IFR web pages.

The one bright spot: Regulators said borrowers were not required “to execute a waiver of any legal claims they may have against their servicer as a condition for receiving payment.”

Last week, a payment framework was released by the Office of the Comptroller of the Currency and the Federal Reserve, with compensation scattered within a sweeping range — from $300 to $125,000.

Out of 3.9 million borrowers, about 2.5 million will get a few hundred dollars each.

Nearly 9,000 borrowers qualify for compensation ranging from $24,000 to $125,000 — involving foreclosures that were initiated or completed against borrowers who had not defaulted on their mortgages or who were meeting all requirements of a documented forbearance plan or were protected by federal bankruptcy law.

Some qualify to receive $3,000 to $50,000 after servicers failed to convert them to permanent mortgage modifications, even after the homeowner completed successful trial periods or were performing all requirements under trial periods.

Nearly 900,000 borrowers who were denied mortgage modifications qualify for an amount between $1,000 to $6,000.

Below those categories in severity of financial harm, botched mortgage modifications played a large part in the amounts configured for payouts, mostly ranging from $300 to $800.

But there is much ambiguity in these supposed lower categories. More than 900,000 borrowers fall under this heading: “Servicer who did not engage with borrower in a loan modification or other loss mitigation action.”

“People who managed to get far enough along in the [modification] process, many of them will get a decent payment,” Alys Cohen of the National Consumer Law Center told ProPublica. “But people who suffered servicer neglect clearly are not getting compensation for the harm they suffered.”

Many borrowers have complained of not being placed in the rightful category, some saying they should have been placed in more than one category.

Commented Christina to eCreditDaily: “We received 500.00 today. We had 3 different categories we fell into, and they choose the one we didn’t fall into. Very sad…”

Checks are being sent “in several waves beginning with 1.4 million checks on April 12,” the OCC said.  The final wave is expected in mid-July 2013. But more than 90 percent of the total payouts to borrowers by 11 servicers are expected to be sent by the end of April.

The banks and their servicing affiliates that are part of the IFR agreement are: Aurora, Bank of America, Citibank, Goldman Sachs, HSBC, JPMorgan Chase, MetLife Bank, Morgan Stanley, PNC, Sovereign, SunTrust, U.S. Bank, and Wells Fargo.


  1. I received a 1000.00 check. I was in the category for 50-125K. I was devasted. Does any one have info on any class action that has been started as a result of this mess?

  2. I recieved 6000.00 but was suppose to get perhaps 50,000.00 or more I am wanting to be apart of a class action suit against these lenders. My lender is HSBC and they still have not modified my house and its been in wthout a modification now since 2008 to present.

  3. It would be alot easier for the government to just mandetory all lenders to modify these loans if the banks were found liable for errors. The feds should also make it possible fannie mae and freddie mac to refinance all loans even from private lenders.

  4. john f, Are you still making payments? Did you apply for a foreclosure review? Just wondering I’m with HSBC but I have not received a check yet. I left the house in January 2011 because they said foreclosure was emminent. The foreclosure still has not taken place ……uuuffff !!!!

  5. I fall in to the 50,000 payment category (filed a request for review in May of 2012; got a trial modification and paid all payments timely; foreclosure COMPLETED IN 2012). I have the trial mod agreement, all correspondence and all payments and checks with signed delivery notices. Provided this to Rust in spring of 2012. I received a 2,000 check. What oversight? They even offered me foreclosure prevention assist in the letter they sent with the check. The house has been vacant since they served me with a notice of eviction last year.

  6. Linda, sorry to hear this. However, this IS NOT OVER. Checks are still going out but when all is said and done we must FIGHT! Also, please read and share with others the information in the following article. Goto;


    Foreclosure Review Outreach/Payment Processor Rust Consulting Was Owned By Residential Real Estate P

  7. There are only 361 signatures on the White House petition and their are 158 responses to this one article alone. Stop wasting time posting your complaints of wrong doing and lets use our collective power to do something about it!! If you haven’t taken time to sign the petition don’t bother posting your story on this or any other site.

  8. I was a victim as well. Only received $600. Totally heartbreaking. My little family suffered for years and we still have not stopped feeling the reprecussions of the foreclosure we went through. I knew better than to expect a huge piece of the pie but $600? Really? How can Taylor Bean & Whitaker bet shut down for illegal acts, get bought out by Bank of America, and then Bank of America get away with foreclosing on homes because they didn’t have enough man power to deal with the amount of borrowers in loss mitigation, and all of that be okay? Don’t we get some kind of retribution from this or is this the end of the road for all of us? I would really like to know how to go about starting a class action lawsuit because I will be more than happy to stand up and say THIS IS NOT RIGHT!!!

  9. Well, 6 mod payments then was denied perm by BofA. Got my check for $600 today. I don’t really know what is the purpose behind this low amount.

    Hey ANONYMOUS , we are calling on you to get some of the files and information we need leaked out to WIKILEAKS. This one is for us, please go get us what will help us.

  10. I got my check today for $800. I should have received $125000. The OCC are criminals supporting the banks. I was clearly NOT in default as stated by BoA themselves in a letter to
    our Attorney General and to the OCC/ Customer Assistance Group. The OCC had every thing needed to decided my claim filed with them but let the banks. A suit should be filed against the deceptve actions the OCC used against us.

  11. I received our check today 800.00 Citi.. We were denied a,loan modification then approved payment plan for 3 months then no word foreclosed on during BK.. A depressing day reliving the nightmare all over again…

  12. I got the bullshit check a few days ago. I have yet to deposit it…for what? I am truly contemplating ripping it up. It sickens me to take another look at it. $300 is a damn insult with all the suffering the bank put me through. They still r not complying with the settlement denied a mod for the 7th time. They’re all gonna die a slow death with the same suffering they put us through but 10 times worse.

  13. @ adodmk Keep Going Hit every Site possible with this Petition… There is a deadline May 24th… Everyone Sign This… LET OUR VOICES BE HEARD!! Great JOB Adodmk!!!

  14. I was in a modification program and somehow the check was a few dollars different then they said it was to be and began foreclosure. I saved the house after borrowing a huge sum from family and they send me $300 !!! I was only 4 months behind to begin with. To save the house cost more than the 4 months worth of payments. I was confused and stressed all the time. Well, now I understand. It was all a scam!!!

  15. It would seem the payment agreement information provided with payment check is vague and missing important details which leads to wondering just what the limits are for borrowers who decide to pursue further actions! I don’t even know which actions are exempt from the enforcement actions and which deficient mortgage servicing and process. When Regulators determined our payment amount based on the (what) stage of our foreclosure.

    I also found it interesting in the other disclosures to block evidence or information we provided to the IFR may not be used for any other reason! I did not agree to that and I should have full rightful access to use any information and evidence as seen fit to the case or defense along with our right to pursue further actions.

    From my understanding, this is a slap on the hand for the violations imposed upon borrowers. Furthermore, how come this payment does not mean that we necessarily suffered financial injury or harm? So where is most of the money really going to for such insufficient settlement not better detailed?

  16. I know some of what they found against my servicer as we still have all documents and the robo signed documents for foreclosure. We recieved a W-9 the other day instead of a check requesting verification of the SS# We called them and said yes they sent it and need it verified and sent back to us. This tells me it is over $600.00. This also tells me that they could have just sent the check and a 1099 or 98 form next year. This also says they that the amount is large enough that they can not take any chances of getting it to the wrong person or me not paying the large amount of taxes owed. Just my prediction and I hope that I am correct, if not I will be upset!

  17. First of all, please sign the petition that “adodmk” has provided in his or her link, to get action started against the majority of borrowers who were wronged in this settlement!!!! I received a payment on May 6th, 2013, and I agree that they did not disclose the category of foreclosure, and stating that the check did not necessarily mean that we were caused any financial injury or harm. How do we know what category we were placed in? I should have been placed in the “BK protection category” not only “modification denied” if that was the category they determined I was in. As of May 8th, Rust Consulting, Inc. is sending out supplemental checks on or about May 17th because the distributed amounts to borrowers with Goldman Sachs and Morgan Stanley fell short (insufficient funds) according the the federal reserve who were suppose to monitored and caught the error. How do we know that out of the 96,000 borrowers with Goldman Sachs and Morgan Stanley, that we will receive an additional check? I will hope it will be substantial, with the correct categories that borrowers under Saxon and Litton were suppose to be placed into to begin with. The 2 billion dollars paid to consultants should have been paid to the borrowers who suffered. What happened with the help to our credit reports that our servicers were suppose to correct, and what about the funds that servicers are suppose to use to help us recoup our homes if they had not been sold to a 3rd party? I thought that even though many borrowers who lost their homes to foreclosure were elgible to get their homes back with a modification loan and foregiveness as long as they were not sold to a 3rd party? Please people, sign the petition!!!

  18. ACTION::::::: It’s time to end Too Big To Fail::::By Sherrod Brown, U.S. Senator
    To be delivered to: The United States House of Representatives and The United States Senate
    Give Wall Street megabanks a choice: Carry enough capital to cover your own losses, or downsize until you’re no longer a threat to American taxpayers.
    Petition Background
    Big Wall Street megabanks are still putting American taxpayers at risk. Big banking institutions like Bank of America and Citibank carry more assets than they have capital to cover. That means that if those assets go south, the banks can’t recover on their own. And when a bank’s failure means the failure of the American economy, the taxpayers are forced to step in. It’s called “Too Big To Fail.” It should also be called “too risky for the American economy” and “too reckless to continue.”
    This is the practice that brought our economy to the brink once before. That’s why I have a new, bipartisan plan to end Too Big To Fail, and break up Wall Street megabanks for good. It would require that banks carry enough capital to cover their own losses, or force them to downsize so that they are no longer a risk to the American economy.
    This is a common sense solution — but I need all of us to help. So sign your name today, and make sure members of Congress know that you’re in favor of the ending “Too Big to Fail.”
    There are currently 91,710 signatures

  19. Maverick,
    Posted the petition on FB
    Faces of the National Mortgage Settlement
    You are more than welcome to join us and post other information!

    su is internet and texting slang for “shut up” That should tell you all something.

  20. The petition is no longer valid: This is the message you get when you go there.

    Thanks for your interest in We the People, a new tool on that allows all Americans to ask the Obama Administration to take action on a range of important issues facing our country.

    The petition you are trying to access has expired, because it failed to meet the signature threshold.

    While you can’t sign this petition, there may be other petitions on We the People on a similar issue that you’d like to add your name to. Or, you can create your own petition.

  21. Not to be confused with the other Chris. First time I saw a poster with the same name since I have been here. I am on the FB page for the NMS now and check here occasionally for updates or information we can post there.

  22. Does anyone know how many signatures that White House petition really needed?

    I read hundreds of comments, stories, and blogs about peoples victimization. I have to tell you it makes me sick.

    I am serious that we need to band together and take our pidley checks and find a law firm that can take the funds in on a retainer fee to start up a class action suit.

    Can anyone please post about any new petitions or advocacy groups that can help. I think we need to open up these situations of discrimination with this settlement. would like to see a story on the major news sites soon. Force the goverment into redemption for the sufferings of all of us.

  23. My question is when are the class action lawsuits going to come about in Florida? I would love to join one for my whopping $600 check with my credit not fixed!

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