(Washington, DC) More than 500 claims by District borrowers who lost their homes to foreclosure will be paid by the National Mortgage Settlement, a total of $754,000 in consumer restitution and approximately $1,480 per covered loan.
The eligible DC borrowers had their home mortgages serviced by the five largest mortgage-servicers: Ally/GMAC, Bank of America, Citi, JPMorgan Chase and Wells Fargo, and lost their homes to foreclosure between January 1, 2008 and December 31, 2011. The servicers agreed last year to settle with the federal government and the attorneys general of 49 states and the District over foreclosure abuses, particularly the “robo-signing” of important foreclosure documents.
“Losing a home is a devastating experience,” said William P. White, commissioner of the Department of Insurance, Securities and Banking. “These payments will help compensate borrowers who have lost their homes and were subject to these foreclosure abuses.”
This payment does not limit a borrower from suing the mortgage servicers or pursuing other claims, White added. He is also pleased the final amount of $1,480 per loan is much higher than the minimum $840 first announced.
The settlement administrator, Rust Consulting, will mail the valid claim payments from June 10 through June 17. Please note several circumstances that may delay your payment, or result in a partial payment:
Some borrowers will receive a check for less than the approximate $1,480 payment in situations where borrowers are divorced or separated and no longer live at the same address. The full per-loan amount will be paid on these loans, but the payment will be evenly split between the borrowers.
A small number of borrowers who submitted a claim form but do not have a valid Social Security number on file will be delayed in receiving their payments while tax-related issues are addressed.
Two servicers only recently provided information on additional borrowers, who could not be included in this distribution. Later this summer, these consumers will receive a notice and will have the opportunity to submit a payment application.
Every borrower who filed a claim will receive a letter regarding their outcome. Borrowers with questions about their National Mortgage Settlement payment should call settlement administrator Rust Consulting at (866) 430-8358.
Finally, the department warns people not to fall prey to scams: Don’t provide personal information to people claiming they can provide assistance with your payment. If you are contacted, notify the Department of Insurance, Securities and Banking at (202) 727-8000.
Note: National Mortgage Settlement, Independent Foreclosure Review Payment Agreement are Separate
Rust Consulting is also the settlement administrator for the Independent Foreclosure Review Payment Agreement through the Office of the Comptroller of the Currency, known as the OCC, and the Federal Reserve Board. The Independent Foreclosure Review Payment Agreement is unrelated and separate from the National Mortgage Settlement and does not include the same governmental agencies. The Independent Foreclosure Review payments began in mid-April of 2013, and the OCC announced that final payments will be mailed in mid-July. For more information on the OCC Independent Foreclosure Review settlement, visit www.OCC.gov.