After widespread complaints by consumer advocates and borrowers about deceitful and improper practices, federal regulators required 14 large residential mortgage servicers to retain independent consultants to provide an unbiased review of their foreclosure actions. Initially, people had until the end of July to request this review.
But now the Comptroller of the Currency and the Federal Reserve have pushed the deadline back to Dec. 31. If your primary residence was involved in a foreclosure process between Jan. 1, 2009, and Dec. 31, 2010, you may qualify for action.
This really is your chance for a no-lose situation. If consultants find fault during the review, then borrowers who suffered financial injury because of errors, misrepresentations or other problems may get money or some other remedy.
The remediation could be significant. If reviewers discover that you were financially injured, you might be entitled to a lump-sum payment, a suspension or rescission of a foreclosure, a loan modification, a correction to your credit reports, or a correction of deficiency amounts. The servicers are providing the compensation as a result of the enforcement actions taken last year.
If you homed in on the money part, which I certainly would if I had gone through a foreclosure, here's what could be on the table. Lump-sum payments can range from $500 to $125,000 in the worst cases involving the lost of a home, said Bryan Hubbard, a spokesman for the Office of the Comptroller of the Currency. The cash payments are not subtracted from any debt you might have owed on the home.
Additionally, if you had equity in your home, you could be entitled to get that money as well, Hubbard said. Of course, the reality is that most people suffering foreclosure didn't have equity.
Besides the primary residence requirement, the mortgage servicer has to be one of the 14 participating companies. Through the end of July, 228,000 people had requested a review, Hubbard said. In addition, 146,000 foreclosures were selected through a sampling process. Of all the reviews slated to occur, 192,000 are already under way, he said.
The best part is that the review is free. Regulators are cautioning people to be careful about scams associated with this process.
"If anybody asks you to pay for a review or pay to complete the application, you should be cautious about that," Hubbard said.
You'll start seeing outreach in advertising to increase awareness of the review process this fall, he said.
You should be aware that the review isn't just for folks whose homes were sold through foreclosure. Consultants will be looking at cases in which homes are still in the foreclosure process or were slated for foreclosure but the process stopped because payments were either brought up to date, the borrower entered a payment plan or modification program, or the home was sold in a short sale or given back to the lender.
Some of the things that could have gone wrong in your foreclosure process include an erroneous mortgage balance. For example, your servicer would have reported that you owed $250,000 on your mortgage, but you believe the correct amount was only $200,000. You might have submitted all the right paperwork and on time for a modification but were foreclosed anyway. You could have been assessed inaccurate fees by the servicer.
Go to independentforeclosurereview.com for a list of the mortgage servicers and their affiliates, and for information about the review process. Your request has to be submitted online or postmarked no later than Dec. 31. To get the form online, you have to click on the link for your servicer. The company to which you sent your monthly payments is your mortgage servicer. If you need help completing the form or if you have questions, call 888-952-9105.
"We want everyone to know that this is a fair and impartial review," Hubbard said. "We want to make sure everyone who is eligible is aware of the opportunity to request a review. You give up nothing by requesting a review and you waive no rights to additional action if you receive compensation."
I know and you know that not every foreclosure review will find that something was done wrong. But take this opportunity to find out if you were financially injured.
Michelle Singletary: firstname.lastname@example.org.
Washington Post Writers Group
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