Mortgage Servicers New $8.5-Billion Settlement

Mortgage Servicers New $8.5-Billion Settlement

New $8.5 Billion Settlement Replaces Independent Foreclosure Review

With the quick dismantling of the Independent Foreclosure Review, the ten nation’s largest mortgage sevicers agreed in its place to a new program that authorities say will distribute aid to homeowners “significantly more quickly.”

Maybe homeowners have heard this scenario before. Scrap one federal bank review program in favor of another. This structure of this “new and improved” settlement has ten of the nation’s largest mortgage servicers have agreed to an $8.5-billion settlement.

Some of the familiar banks names took part in the settlement including Bank of America, Wells Fargo, JPMorgan Chase and Citigroup.

The Office of the Comptroller of the Currency and the Federal Reserve announced specifics of the settlement breakdown which state that the mortgage companies will make $3.3 billion in direct payments to “eligible borrowers” whose foreclosures were handled improperly, and will make $5.2 billion available in other assistance to struggling borrowers, such as loan modifications.

Borrowers Can Receive Up To $125,000

Similar to the Independent Foreclosure Review, borrowers could receive as much as $125,000, depending on the type of problems with their foreclosures. Unfortunately, most borrowers did not qualify for payments of that magnitude. We don’t hold much confidence that homeowners will benefit greatly from this settlement.

Many watchdog groups criticized the Independent Foreclosure Review as not being truly independent. With the banks having some input into the review process, some compared it to the fox guarding the henhouse

This new settlement couldn’t be less effective than the Independent Foreclosure Review, so let’s see how this new program benefits homeowners.

Independent Foreclosure Review Scrapped

Independent Foreclosure Review Scrapped

December 31, 2012 Sees Regulators End Independent Foreclosure Review

While most people celebrated the coming 2013 and the U.S. Congress argued and negotiated and ultimately watched our economy fall of the “fiscal cliff,”  federal regulators scrapped the foreclosure review program.

Known to most as the Independent Foreclosure Review, the program met with only moderate success while garnering heaping amounts of criticism. The program ultimately ended on December 31, 2012, and in place of it regulators swapped it for a $10 billion settlement with 14 banks. Much of the criticism of the program arose as several independent watchdog groups claimed that the review lacked true independence.

In addition, most homeowners who applied for the review through the Office of the Comptroller of the Currency, which administers the review, saw little if any compensation as a result of the review. A majority of homeowners who had their home foreclosed did not apply for the review because they either did not trust the process or were simply disillusioned by the whole foreclosure ordeal. The good news for California homeowners is that they may be able to deal with their foreclosure issues directly as a result of the California Homeowners Bill of Rights taking effect as of January 1, 2013.

250,000 Homeowners Remain In Program Limbo

No one knows what will become of the 250,000 homeowners who had applied for the review before the December 31, 2012 deadline. As for as the compensation, no one can be sure if homeowners will actually see any direct assistance from this latest bank settlement. We will keep tabs of the latest changes.

Happy 2013!

Independent Foreclosure Review Deadline Looms and Underwater Homeowner Panel Today

Independent Foreclosure Review Deadline Looms and Underwater Homeowner Panel Today

Independent Foreclosure Review Expires December 31, 2012

With much of the focus on the expiration of the Mortgage Debt Forgiveness Relief Act many homeowners have forgotten (or ignored) the upcoming conclusion of the Independent Foreclosure Review.

Although the program has been in effect for some time, few people have taken the opportunity to apply. For those unaware of the program, homeowners who suffered through a foreclosure or incurred some negative action on their home can submit their case to the Office of the Comptroller of the Currency (OCC) for an independent third party review of the circumstances and practices surrounding the foreclosure, loan modification denial, etc.

Many people either have not heard about the review or have simply ignored the opportunity. Many homeowners report that they do not trust the system or feel that the review will not benefit them. The fact is that some people have received compensation as a result of the review however the numbers remain relatively few.

ForeclosureHelpSCC has put a petition on Change.Org, requesting that the Federal Reserve, OCC, and Office of Thrift Supervision postpone the deadline for applying for the review until two months after at least 215,000 homeowners have heard about the results of their cases.

Over 800,000 Homeowners Should Have Qualified For HAMP

A report released in November found that an additional 800,000 homeowners should have qualified for HAMP but didn’t because some of the large banks/servicers did not perform modifications at the same rate as their peers.

Speaking of HAMP, the Bay Area Resource Underwater Panel Event will take place tonight in San Mateo and via video stream. Anyone seeking info about the Mortgage Debt Forgiveness Relief Act, California Homeowners Bill of Rights, and the Independent Foreclosure Review or to figure out some options of what to with their underwater home should attend this free event.

Foreclosed Homeowners Unresponsive To OCC-Ordered Mortgage Servicing Survey

OCC-Ordered Mortgage Servicing Survey – Not Many Takers

Remember a few months ago when we reported that foreclosed and pre-foreclosed mortgage would be receiving mortgage servicing surveys as ordered by the OCC? Independent consultants hired to review loans as part of federal consent orders signed with 14 mortgage servicers in April 2011 are encountering low participation rates from foreclosed borrowers.

The OCC mandated the audits to discover improprieties that could warrant compensation for affected consumers. However, the response rate has been far less than the 25 percent anticipated return rate.

OCC-Ordered Mortgage Servicing Survey- Frustrated With The System

Not to sound too sarcastic but could it be that current and foreclosed homeowners don’t trust the banks or the audit system or perhaps they simply don’t wish to continue dialogue with agencies and intuitions that they have been frustrated with in the past.

If anyone has completed their survey and would like to share your response and outcome then please feel free to contact us.