Delawareans Who Lost Homes to Foreclosure to Receive Important Notice
Borrowers may be eligible for payments up to $2,000
Wilmington – State Attorney General Beau Biden announced today that forms are being mailed to more than 2,300 Delawareans who may be eligible for monetary payments as part of the national mortgage foreclosure settlement.
Borrowers who lost homes to foreclosure between January 1, 2008 and December 31, 2011 could receive payments up to $2,000 if their mortgage was serviced by one of the five banks that participated in the settlement with 49 state attorneys general and the federal government. Those banks are: Ally/GMAC; Bank of America; Citi; JPMorgan Chase; and Wells Fargo.
Notification postcards were sent to eligible borrowers last week by the administrator of the national settlement. Between now and October 12, those borrowers will receive packets containing instructions and a one-page form to claim the payment, as well answers to frequently asked questions. Borrowers with questions may email the settlement administrator at firstname.lastname@example.org, or call 1-866-430-8358, Monday through Friday from 8 a.m. to 8 p.m.
“These payments will provide real relief for many Delawareans who lost their homes to foreclosure,” said Biden. “I also want to remind all borrowers, regardless of whether they are eligible for payments under the national settlement, that there is help available. Homeowners should keep an eye out for mortgage-related mailings that can inform them about their options and reach out to my office by calling 1-800-220-5424.”
Borrowers eligible under the multistate settlement should complete and return their claim forms as soon as possible, either by using the return envelope provided in the packets or by filing online at www.nationalmortgagesettlement.com. The deadline for all claims is January 18, 2013. Payment checks are expected to be mailed in mid-2013.
The $2,000 payments are part of the $25 billion settlement reached in February that settled claims of improprieties in mortgage servicing and mortgage foreclosure. In all, Biden secured $45 million for Delaware in the settlement In addition to the funds for the payments to Delawareans who lost homes to foreclosure, the settlement includes:
• More than $32 million that banks will provide to current and former homeowners in the form of credits to reduce principal mortgage loans, extinguish second lien mortgage loans and waive deficiencies in short sales. It will also provide refinancing to homeowners who are current on their mortgages but are otherwise unable to obtaining refinancing because they owe more than their homes are worth.
• $8.3 million that banks will pay to Biden’s office related to the multistate release of claims, as well as an additional payment of $2.5 million to settle a portion of the suit Biden filed related to the banks’ conduct related to the Mortgage Electronic Registry Service. This money will be used to fund homeowner assistance programs, educational outreach, support Delaware’s new mortgage mediation program, and fund ongoing and new civil and criminal investigations and cases related to the foreclosure crisis.
Biden also fought to secure important new protections for the men and women serving in the military. The multistate settlement addresses several areas of concern to military families, including complications associated with Permanent Change of Station (PCS) orders, mortgages taken out after beginning military service, and ways to mitigate losses often incurred as a result of the demands of military life. Specifically, the settlement:
• Establishes that PCS orders must now be considered when banks and servicers are making hardship determinations about short sales, deeds in lieu, and loan modifications. Additional protections guard against inaccurate reporting of servicemembers to credit reporting agencies for using loss mitigation options in these circumstances.
• Increases servicemember access to loss mitigation options, including mandating that information and contact with SCRA-trained employees is readily available, and that servicers go beyond the requirements of the SCRA to ensure that more borrowers who are entitled to assistance before foreclosure receive it.
• Specifies that homes of active duty servicemembers deployed in combat areas cannot be foreclosed on without additional protections in most instances, even if the debt was incurred after they entered military service. This was a significant expansion beyond the terms of the SCRA, which only provides this protection for debt incurred before entering the armed forces.