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.