As this year’s deadline approaches for incomes taxes owed in 2013, mortgage settlement recipients will have to deal with any tax implications. The big question: Will they have to pay taxes on these payouts, which totaled more than $4.5 billion?
A trio of Democratic lawmakers are again calling on bank regulators to disclose “critically important” information behind the scuttled Independent Foreclosure Review. Now they are requesting that the Federal Reserve and the Office of the Comptroller of the Currency provide this information by no later than the end of the year.
A regulator has announced stricter rules for some of the biggest U.S. banks when it comes to hiring independent consultants. The move was mainly inspired by the troubled Independent Foreclosure Review, which dragged on with little progress and at great expense before borrowers were finally compensated this year.
A jury this week found a top executive at Bank of America’s Countrywide unit, Rebecca Mairone, liable for at least some of the fraud related to selling bad mortgages. That executive went on to work on the Independent Foreclosure Review for JPMorgan Chase.
Two huge settlements with the biggest U.S. banks — dubbed the National Mortgage Settlement and the Independent Foreclosure Review — involved millions of wronged homeowners thrust into foreclosure. But that’s not enough to convince Wall Street Journal editorial board member Mary Kissel.
Federal regulators said EverBank has agreed to pay $37 million in cash payments to more than 32,000 eligible mortgage borrowers after the Jacksonville, Florida-based lender effectively ended its part in the Independent Foreclosure Review.
More than 232,000 borrowers whose homes were in any stage of foreclosure in 2009 and 2010 with GMAC Mortgage will now receive cash compensation under the Independent Foreclosure Review agreement.
About $1 billion worth of checks have gone uncashed or undeposited. No numbers have been released as to how many represent checks mailed to wrong addresses, or checks that have been lost or checks that recipients have simply refused to claim, one way or another.
The states with the top five dollar amounts for checks cashed or deposited are — not surprisingly — some of the hardest hit of the foreclosure crisis: California ($452,917,548); Florida ($306,412,612); Arizoan ($127,842,971); Michigan ($108,540,951); and Georgia ($106,882,789).
“The bank processing the checks has told us that the cash rate exceeds that of other consumer settlements that they have been involved with,” the OCC spokesman said. “Agencies will continue to monitor the rate at which checks are cashed or deposited and will determine whether additional outreach is required.”