August 8, 2016 Update: Payments to nearly 650,000 borrowers of servicers supervised by the Federal Reserve who cashed or deposited their initial checks to begin on August 8
At the direction of the Federal Reserve, on August 8 and 15, the paying agent, Rust Consulting, Inc. (Rust) will mail payments to nearly 650,000 eligible borrowers of Federal Reserve supervised servicers who cashed or deposited their initial checks from the Independent Foreclosure Review (IFR) Payment Agreement by the March 31, 2016 deadline. The redistribution of funds remaining from the IFR Payment Agreement that were attributable to Federal Reserve supervised servicers will provide a total of over $80 million to borrowers, consistent with the Federal Reserve’s intention to distribute the maximum amount of funds to borrowers potentially affected by deficient servicing and foreclosure practices.
Under the redistribution, every eligible loan will receive a payment of $124.30. Borrowers receiving a redistribution payment will have the opportunity to request a name on a payment to be changed, a payment to be split, or a payment to be reissued. All requests must be received by Rust no later than September 30, 2016. In early-November, there will be a one-time mailing of redistribution check reissuances to accommodate all reissue, payee change, and split check requests. All redistribution checks will expire on December 31, 2016.
Servicers covered include GMAC Mortgage, Goldman Sachs/Litton Loan Servicing, Morgan Stanley/Saxon Mortgage Services, and SunTrust. In addition, some borrowers whose loans were serviced by HSBC or JPMorgan Chase may be covered. HSBC and JPMorgan Chase borrowers should contact Rust at 1-888-952-9105 to determine whether their loan was serviced by the part of the servicing operations of those two companies that is supervised by the Federal Reserve.
For borrowers who did not cash or deposit their initial distribution check by the March 31, 2016 deadline, the Federal Reserve has instructed Rust to correct any applicable tax reporting from that payment with the Internal Revenue Service and mail the borrower a corrected tax reporting document. Corrected tax reporting documents are expected to mail in August.
For additional information on the IFR Payment Agreement and the redistribution of remaining funds, please refer to Frequently Asked Questions For questions related to a redistribution payment, please call Rust at 1-877-456-1188.
If your loan was serviced by one of the mortgage servicers under the Office of the Comptroller of the Currency’s supervisory authority, please refer to the OCC’s website for additional information.