Another 1.4 million checks for eligible borrowers from the Independent Foreclosure Review were sent out today by Rust Consulting, the second of four batches.
The checks today totaled $1.2 billion, bringing the total to date to $2.4 billion in payments.
The next two mailings are scheduled for April 26 and May 3.
A total of 434,484 checks have been cashed or deposited for a total amount of more than $418.8 million from the first mailing April 12, according to bank regulators, as of Thursday.
The final wave of payouts is expected in mid-July 2013.
Rust Consulting has had its share of problems. Some checks in the first batch bounced because of
insufficient funds with the paying bank, The Huntington National Bank.
That caused Federal Reserve staff to contact the paying agent to fix the embarrassing problem that represented yet another hurdle for some IFR borrowers.
There were also many address corrections needed to ensure that all intended eligible recipients are reached.
Rust said Wednesday that the full compensation amount of $3.6 billion is available to be cashed or deposited.
Yet another hurdle for check recipients — especially those disputing the category of servicer wrongdoing into which they were placed — is getting specific answers to how the compensation amounts were determined.
Rust Consulting is mostly equipped to answer questions about the checks and verify whether borrowers are eligible for a payout.
“Borrowers can call Rust at 1-888-952-9105 to update their contact information or to verify that they are
covered by the agreement,” said the Office of the Comptroller of the Currency.
Here’s part of the prepared testimony from David Holland, executive vice president of Rust Consulting, from the Senate Banking Committee hearing on Wednesday regarding the IFR.
“Rust continues to staff a call center to take incoming calls from homeowners with questions about the program and update the website for the IFR project to provide new information regarding the Settlement,” Holland said.
During the hearing, Holland was asked questions by Sen. Jeff Merkley, D-Oregon, about the compensation and specific categories into which borrowers were placed.
Sen. Merkley: “How would the servicers, who had not been the ones reviewing the files and had been essentially at the heart of so many pieces of dysfunction, possibly be a responsible party for putting people in the categories of harm?”
Holland: “I don’t have knowledge of how that process or how that process came about. We received the
categorizations directly from the servicers and the OCC provided us with the dollar amounts that
corresponded to those categorizations.”
These leaves many borrowers few, if any, answers. Many have taken to forums to get more information and compare their experiences with the mortgage services.
Rust Consulting, however, communicates regularly with both regulators and mortgage servicers.
More from Holland’s testimony: “As part of the Settlement, Rust provides comprehensive daily statistical reporting to the OCC, the FRB and the servicers. Daily conference calls are held with the servicers covering project execution. Two times weekly, conference calls are held with the OCC and the FRB covering project execution and future deliverables.”
The IFR was initiated in 2011 and scrapped this January in favor of a $9.3 billion settlement with 13 servicers, including the largest U.S. banks — JPMorgan Chase, Bank of America, Citi and Wells Fargo.