Eligible Connecticut Borrowers Who Lost Homes to Foreclosure To Receive Nearly $7 Million from National Settlement
Attorney General George Jepsen said today that as a result of the national mortgage foreclosure servicing settlement, nearly $7 million is being distributed in Connecticut to approximately 5,000 Connecticut borrowers who lost their homes to foreclosure.
Checks of approximately $1,480 are being mailed between June 10 and June 17 to eligible borrowers who submitted valid claims to the national settlement administrator.
“These checks are being paid from a $1.5 billion payment pool we negotiated and set aside as part of the National Mortgage Settlement,” Attorney General Jepsen said. “I’m pleased the final amount is much higher than we anticipated when the settlement was first announced.”
Jepsen was part of the executive team that helped to negotiate the settlement, reached in February 2012, between the federal government, 49 states and the nation’s five largest loan servicing companies: Ally (formerly GMAC), Bank of America, Citi, JPMorgan Chase and Wells Fargo. Preliminary data shows that since then, the companies have provided more than $50 billion in direct settlement relief to borrowers nationwide.
Borrowers eligible for this payment had their mortgage loans serviced by one of the five participating companies; lost their home to foreclosure between January 1, 2008 and December 31, 2011, and submitted a valid claim form.
In Connecticut, 7,683 loans were eligible for the payment and at least one valid claim was submitted for 4,670 of those loans. In 171 cases, however, more than one valid claim was submitted. Co-borrowers who submitted separate claim forms will receive separate checks but share the $1,480 amount.
Jepsen said the payment was not intended as restitution, but to help compensate borrowers for mortgage servicing abuse they may have experienced from the participating loan servicing companies. The payment does not prevent a borrower from seeking relief through a separate lawsuit or other claims process.
Nationally, the settlement administrator, Rust Consulting, will mail 962,278 valid claim payments. A relatively small number of borrowers will not receive a check in the initial mailing or will receive a split payment.
• Where borrowers are divorced or separated and no longer live at the same address, the $1,480 payment will be evenly split between the borrowers.
• Payments will be delayed for a small number of borrowers who submitted a claim form but do not have a valid Social Security number on file.
• Two servicers recently provided information on an additional 31,000 eligible borrowers, and thus they could not be included in this distribution. Later this summer, these consumers will receive a notice and will have the opportunity to submit a claim form.
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 1-866-430-8358.
Rust Consulting is also the settlement administrator for the Independent Foreclosure Review (IFR) payment agreement through the Office of the Comptroller of the Currency (OCC) and the Federal Reserve Board. The IFR settlement is unrelated and separate from the National Mortgage Settlement and does not include the same governmental agencies. The IFR 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, go to www.OCC.gov
and click on Independent Foreclosure Review.
Assistant Attorneys General Joseph Chambers and Matthew Budzik, Finance Department head, are assisting the Attorney General with this matter.