National Mortgage Settlement

With all the news about the foreclosure settlement and President Obama’s plan, I want to share with you some information to help make sense of it all. 

“The Settlement” is an agreement between 49 states, including Georgia, the federal government and 5 banks. The banks have agreed to pay $25 billion dollars to begin to make good on their part in causing the economic crash. I believe that the dollar figure should have been much larger, but this is the biggest step yet towards making it right.  Please take a moment to visit the settlement website which has contact information for the banks and other helpful information. 

The settlement includes:

·         $17 billion toward loan modifications and similar assistance for delinquent borrowers.

·         $3 billion for “underwater” borrowers with negative equity to refinance their homes.

·         $4 billion in payments to borrowers who lost their homes to wrongful foreclosure (as much as $2,000 per case) and help for state-run housing assistance like legal aid and foreclosure prevention.

Georgia's share of the settlement should be more than $814.7 million. Georgia’s Attorney General will control the money and will distribute:

·         $101.8 million to refinance loans to some underwater borrowers,

·         $526 million to benefit loan term modifications and

·         $104 million to be used to prevent foreclosures and prosecute financial fraud.

Again, this is too small and for many, it is too late. I will push for more.

You should also know that this agreement won’t let the banks off the hook. State Attorneys General will now focus on investigating and prosecuting those that caused the housing crisis. The servicers are also forced to use new servicing standards that will correct the kinds of conduct that harmed consumers during recent years.

What does this mean for Atlanta Homeowners? What should you do?

The banks have agreed to step up. They have agreed to be pro-active. They won’t just call or write you. They can’t just send you an email and be done. They must reduce the principle or refinance if they are to live up to the dollar amount in the agreement. Otherwise, they will have to pay additional money. They must seek out the people that they’ve harmed and help them.  Their plan for doing so should come in the next few weeks. Right now, the states are preparing the actual agreement to give to the courts. More information about the settlement is available at http://www.nationalmortgagesettlement.com/.

What about the President’s plan? How does this all tie together?

The President introduced a new housing plan that will allow all homeowners who are up to date on their payments to refinance at the current low market rates. The President announced in his State of the Union speech that he will send Congress a plan that will allow responsible homeowners who are current on their payments to save $3k a year on their mortgage by refinancing at historically low interest rates.  The President is proposing to use part of a proposed bank fee to cover the cost of the refinancing plan, since some of the financial institutions helped cause the housing crisis from which borrowers and the economy are still trying to recover.

For more information go to www.HopeNow.com or call the free Homeowner’s HOPE™ Hotline at (888) 995-HOPE™.FREE foreclosure prevention counseling on the phone or online

If I feel that I was wrongly foreclosed upon, and don’t want to wait for the settlement, where can I get help now?

The settlement is not the only help out there. If you are one of the many people who were wrongfully foreclosed upon during the housing crisis, you may be eligible for a free, impartial, independent foreclosure review and compensation.  As part of an agreement with the Board of Governors of the Federal Reserve System and the Office of the Comptroller of the Currency, fourteen mortgage servicers are offering reviews to borrowers who faced a foreclosure action on their primary residence during the period of Jan. 1, 2009 through Dec. 31, 2010. The reviews will be conducted by independent consultants upon request by borrowers. The process will determine whether the borrower experienced financial harm as a result of errors, misrepresentations or deficiencies in the foreclosure process.

Borrowers potentially eligible for the Independent Foreclosure Reviews should submit a Request for Review Form. Information on the form and the process may be found at www.IndependentForeclosureReview.com or by calling 888-952-9105 Monday through Friday 8:00 a.m. - 10:00 p.m. ET and Saturday 8:00 a.m. - 5:00 p.m. ET

The servicers (and their successors and affiliates) participating in the program include: America's Servicing Company, Aurora Loan Services, Bank of America, Beneficial, Chase, Citibank, CitiFinancial, CitiMortgage, Countrywide, EMC, EverBank/Everhome Mortgage Company, First Horizon, GMAC Mortgage, HFC, HSBC, IndyMac Mortgage Services, MetLife Bank, National City, PNC, Sovereign Bank, SunTrust Mortgage, U.S. Bank, Wachovia, Washington Mutual and Wells Fargo.

Other Helpful info:

Home Safe Georgia – For homeowners who are unemployed, or who have a decrease in income due to national economic conditions.

The Atlanta Legal Aid Society (404) 524-5811 - SENIOR HOTLINE: 1-888-257-9519

Stop trouble before it starts - if you think you will be unable to pay your mortgage

FHA National Servicing Center - (877) 622-8525 - FHA-insured loans only

Fannie Mae Mortgage Help Center - (866) 442-8573

HOPE NOW Alliance - Learn about HOPE LoanPort™ and find a counselor,