Schuette Informs National Mortgage Settlement Monitor About Concerns with Banks’ Settlement Compliance

LANSINGAttorney General Bill Schuette today sent a letter to Joseph A. Smith, Jr. head of the Office of Mortgage Settlement Oversight to alert him to concerns that certain terms of the National Mortgage Settlement are not being met by the banks that signed on.

“As we continue to sort through the aftermath of the mortgage foreclosure crisis, Michigan homeowners can rest assured that we will hold all five banks accountable to the terms of the national morgtage settlement,” said Schuette.

“I take any violations of the requirements of the settlement very seriously, and as a member of the monitoring committee, will work closely with all involved to ensure that the settlement is properly enforced,” noted Schuette in the letter to Smith.

Schuette also acknowledged the concerns of New York Attorney General Eric Schneiderman regarding banks not adhering to the required customer service standards:

“In particular, issues regarding servicers responding to borrowers in a timely manner to requests for modifications, servicers failing to notify borrowers of deficiencies in their applications for modification, giving borrowers time to supplement applications when necessary, timely decision making, and all the other servicing standards imposed by the settlement impact borrowers in a very real and direct way.”

  Under the terms of the National Mortgage Settlement, the court-appointed a monitor, Joseph A. Smith, Jr. monitors and determines if servicers are compliant with terms of the settlement.  Smith works with a monitoring committee comprised of representatives of state attorneys general, including Attorney General Schuette. The Committee meets to address the many issues involved in the implementation and monitoring of the settlement, and holds regular discussions with Smith and his staff. 

Current state members of the Monitoring Committee include: Arizona, California, Colorado, Connecticut, Florida, Illinois, Iowa, Maryland, Michigan, Nevada, North Carolina, Ohio, Oregon, Texas, and Washington.  In addition to representatives from attorneys general, the committee includes State Financial Regulators, the United States Department of Justice, and the United States Department of Housing and Urban Development. 

In February 2012, Schuette, along with 49 other States Attorneys General entered into a landmark settlement with the five leading bank mortgage servicers to address allegations of faulty foreclosure processes and poor servicing of mortgages that harmed homeowners nationwide. The settlement requires the bank mortgage servicers to provide up to $25 billion in monetary sanctions and relief. It is the largest consumer financial protection settlement in U.S. history.

Click here to view a copy of the letter sent to Joseph A. Smith, Jr.