Independent Foreclosure Review: 1,135 Borrowers to Receive Max $125,000 Payment in Fraudclosure Settlement
1,100 borrowers to receive max $125,000 payment in foreclosure settlement
Federal regulators announced this morning that foreclosure reparation checks to 4.2 million borrowers will go out beginning Friday, including payments of $125,000 each to 1,135 borrowers.
The checks are part of a $3.6 billion settlement reached earlier this year that replaces the failed Independent Foreclosure Review, which few eligible borrowers applied for. Borrowers are eligible for the money if they were in any stage of the foreclosure process in 2009 or 2010 and had their mortgages serviced by Aurora, Bank of America, Citibank, Goldman Sachs, HSBC, JPMorgan Chase, MetLife Bank, Morgan Stanley, PNC, Sovereign, SunTrust, U.S. Bank, and Wells Fargo.
Hundreds of thousands of Florida homeowners will receive the checks, including an estimated 50,000 in Palm Beach County.
The checks will be sent in several waves, beginning with 1.4 million on Friday. The final wave is expected in mid-July 2013.
The payout amounts are based on the level of wrongdoing and whether a home was ultimately repossessed by the bank.
For example, homeowners who applied for a loan modification but never received an answer will get between $400 and $800, while homeowners who had their home repossessed even though they weren’t in default will receive $125,000. Just 53 homeowners fall into that category, but another 1,082 homeowners who were foreclosed on despite being eligible for the Servicemembers Relief Act will also receive $125,000.