It’s been a year since federal regulators announced an agreement with more than a dozen mortgage servicers to settle wrongful foreclosures or mortgage-modification abuses affecting more than 4.2 million borrowers.
As of the latest update, nearly 732,000 checks remain uncashed under the Independent Foreclosure Review settlement.
As of Dec. 31, 2013, almost all of the 4.2 million checks totaling $3.6 billion to compensate victims had been issued, according to the Office of the Comptroller of the Currency. This many checks have been cashed or deposited so far: 3,468,176.
Total amount cashed or deposited so far: $3 billion.
That leaves $600 million unclaimed.
It’s still not clear how many of the uncashed checks were delivered to the wrong address, though regulators via Rust Consulting, the paying agent, have reissued more than 850,000 checks since autumn to ensure that all eligible borrowers get their rightful share of the settlement, according to the Huffington Post.
In April 2013, the first wave of checks were received, with the average payout at about $865. Most people received checks for about $300.
Over the past year, IFR borrowers have communicated to eCreditDaily and other news blogs their outrage over the compensation and initial review process. IFR borrowers who were victims of mortgage servicer abuses, deficiencies or mistakes — some of which resulted in wrongful evictions — have yet to get a full picture of what the initial foreclosure reviews entailed, even after Democratic lawmakers have demanded a detailed accounting.
“This is ridiculous,” Roberta Reid, of Portland, Maine, told the HuffPost. Reid is due a payment that she calculates at about $5,000, but she said she has not gotten any answers about her missing check. “I’ve called dozens of times.”
The settlement a year ago was reached after nearly two years of costly delays in the “independent foreclosure review” of documents tied to foreclosures in 2009 and 2010. Regulators finally decided that too much time and money had gone wasted with no funds reaching any borrowers.
Thirteen banks agreed to pay $9.3 billion to end the reviews and directly compensate foreclosed-upon borrowers. Two additional lenders reached a settlement later in 2013, bringing the total number of servicers to 15.
Of that $9.3 billion total, $3.6 billion was designated as direct compensation to borrowers placed under various categories of wrongdoing. Much of the rest of the settlement amount has gone to or will fund mortgage modifications and other foreclosure-prevention efforts.
If you still haven’t received a check, here is the contact information from the OCC:
“Checks issued as part of the Independent Foreclosure Review Payment Agreement expire 90 days after they are issued as a means to limit fraud. If your check has expired and you would like to have the check reissued, please contact the paying agent, Rust Consulting, at 1-888-952-9105, Monday through Friday, 8 a.m. – 10 p.m. ET or Saturday, 8 a.m. – 5 p.m. ET.”