July 26, 2013 Update: GMAC Mortgage joins Payment Agreement
GMAC Mortgage has reached an agreement with the Federal Reserve Board to pay $230 million in direct cash payments to eligible borrowers. The $230 million to be paid by GMAC Mortgage includes $32 million that will satisfy GMAC Mortgage’s obligation to provide loss-mitigation assistance. This agreement is similar to those announced in January between 13 mortgage servicing companies and the Office of the Comptroller of the Currency (OCC) and the Federal Reserve Board. Like the other institutions, GMAC Mortgage was subject to an enforcement action for deficient practices in mortgage loan servicing and foreclosure processing.
More than 232,000 borrowers whose homes were in any stage of foreclosure in 2009 and 2010 with GMAC Mortgage will receive cash compensation under the agreement. Information about payments to borrowers whose mortgage serviced by GMAC Mortgage will be announced in the near future. As a result of this agreement, the independent foreclosure reviews have concluded for GMAC Mortgage borrowers.
April 29, 2013 Update: Payments to 220,000 Borrowers Whose Mortgages Serviced by Goldman Sachs and Morgan Stanley to Begin on Friday, May 3
- May 8, 2013 Update: Federal Reserve provides additional information on borrowers whose mortgages were serviced by Goldman Sachs and Morgan Stanley
- Payment Agreement Details for Goldman Sachs and Morgan Stanley Borrowers (PDF)
Payments to more than 220,000 borrowers whose mortgages were serviced by Goldman Sachs and Morgan Stanley are scheduled to begin on Friday, May 3 following an agreement announced earlier this year by the Federal Reserve Board. The agreement provides $247 million in direct payments to borrowers whose homes were at any stage of the foreclosure process in 2009 and 2010 with the former subsidiaries of Goldman Sachs (Litton Loan Servicing LP) and Morgan Stanley (Saxon Mortgage Services, Inc.). The payments stem from agreements reached earlier this year between 13 servicers and two agencies--the Office of the Comptroller of the Currency and the Federal Reserve. The agreements provide for a total of $3.6 billion in cash payments to 4.2 million borrowers.
In most cases, borrowers will receive a letter with an enclosed check sent by the Paying Agent--Rust Consulting, Inc. Some borrowers may receive letters from Rust requesting additional information needed to process their payments. Previously, Rust sent postcards to borrowers notifying them of their eligibility to receive payment under the agreement.
Borrowers can call Rust at 1-888-952-9105 to update their contact information, verify that they are covered by the agreement, or with further questions. Information provided to Rust will only be used for purposes related to the agreement.
April 9, 2013 Update: Payments to 4.2 Million Borrowers Covered by Foreclosure Agreement to Begin April 12
In most cases, eligible borrowers will receive a letter with an enclosed check sent by the Paying Agent--Rust Consulting, Inc. Some borrowers may receive letters from Rust requesting additional information needed to process their payments. Rust is sending all payments and correspondence regarding the foreclosure agreement at the direction of the OCC and the Federal Reserve.
Borrowers can call Rust at 1-888-952-9105 to update their contact information or to verify that they are covered by the agreement. Information provided to Rust will only be used for purposes related to the agreement.
March 18, 2013 Update: Borrower Information Postcards Mailed
On March 18, 2013, more than 4.2 million people were sent postcard notices about payments they will receive as a result of an agreement between federal banking regulators and 13 mortgage servicers. For more information, please call 1-888-952-9105, which is the number for Rust Consulting--the Paying Agent--that is printed on each postcard.
In January 2013, thirteen mortgage servicing companies subject to enforcement actions for deficient practices in mortgage loan servicing and foreclosure processing reached an agreement in principle with the Office of the Comptroller of the Currency and the Board of Governors of the Federal Reserve System to provide more than $9.3 billion in cash payments and other assistance to help borrowers. The sum includes $3.6 billion in direct cash payments to borrowers covered by the agreement and $5.7 billion in other foreclosure prevention assistance, such as loan modifications and forgiveness of deficiency judgments. In July 2013, one additional mortgage servicing company joined the payment agreement, bringing the total number of mortgage servicing companies participating in the payment agreement to 14. With the addition of that servicer, $230 million in direct cash payments will be made to GMAC Mortgage borrowers under the agreement. In August 2013, EverBank also reached an agreement to pay approximately $37 million in cash payments to more than 32,000 eligible mortgage borrowers.
For the participating servicers, fulfillment of the agreement satisfies the foreclosure review requirements of enforcement actions issued by the Office of the Comptroller of the Currency, the Board of Governors of the Federal Reserve System and the Office of Thrift Supervision in April and September 2011 and April 2012.
The agreement has been memorialized by amendments to the consent orders for each of the 13 participating servicers as of February 28, 2013, and for GMAC Mortgage as of July 26, 2013. The amendments to the consent orders are publicly available on the websites of the Office of the Comptroller of the Currency (OCC), and the Board of Governors of the Federal Reserve System. EverBank’s agreement with the OCC will also be memorialized in an amendment to their order.
The OCC and the Federal Reserve accepted this agreement because it provides the greatest benefit to consumers subject to unsafe and unsound mortgage servicing and foreclosure practices during the relevant period in a more timely manner than would have occurred under the Independent Foreclosure Review process.
Participating servicers under the agreement, including their current and former affiliates covered under the agreement, include:
|America's Servicing Company||EMC Mortgage Corporation||PNC Mortgage|
|Aurora Loan Services||EverBank/EverHome Mortgage Company2||Saxon Mortgage1|
|BAC Home Loans Servicing||GMAC Mortgage||Sovereign Bank|
|Bank of America||Goldman Sachs1||SunTrust Mortgage|
|Citibank||Litton Loan Servicing LP1||Washington Mutual (WaMu)|
|CitiFinancial||MetLife Bank||Wells Fargo Bank, N.A.|
|CitiMortgage||Morgan Stanley1||Wilshire Credit Corporation|
|Countrywide||National City Mortgage||
As a result of this agreement, the Independent Foreclosure Review, which involved case-by-case reviews, has ceased at the participating servicers and been replaced with a broader framework allowing all of the borrowers of the participating servicers covered by the agreement to receive compensation significantly more quickly.
Borrowers Covered Under the Payment AgreementBorrowers whose mortgage loan was serviced by one of the 14 participating servicers and who were involved in a foreclosure action on their primary residence between January 1, 2009, and December 31, 2010, will receive compensation. Borrowers are included, whether or not they filed a request for review form. Borrowers are not required to take any additional steps to receive payments.
Borrowers covered by the agreement are expected to receive compensation ranging from hundreds of dollars up to $125,000, depending on the type of possible servicer error.
Payment ProcessA Paying Agent, Rust Consulting Inc., has been retained to administer payments to borrowers on behalf of the servicers. Borrowers whose mortgages were serviced by participating servicers other than GMAC Mortgage, were contacted by the Paying Agent beginning in March 2013 with additional information regarding their payment. Borrowers whose mortgages were serviced by GMAC Mortgage are expected to be contacted by the Paying Agent in the next few months
Receiving a payment will not prevent borrowers from taking any action they may wish to pursue related to their foreclosure. Servicers are not permitted to ask borrowers to sign a waiver of any legal claims they may have against their servicer in connection with receiving payment.
Borrowers can call Rust Consulting, Inc. at 1-888-952-9105 to update their contact information or to verify that they are covered by the payment agreements.
1. Although not part of the Independent Foreclosure Review, on January 16, 2013, Goldman Sachs (Litton Loan Servicing LP) and Morgan Stanley (Saxon Mortgage Services, Inc.) reached similar agreements in principle with the Federal Reserve related to enforcement actions for deficient practices in mortgage loan servicing and foreclosure processing. With the addition of Goldman Sachs (Litton Loan Servicing LP) and Morgan Stanley (Saxon Mortgage Services, Inc.), nearly 4.2 million borrowers will receive a total of $3.6 billion in cash compensation while an additional $5.7 billion will be provided by the thirteen servicers for mortgage assistance. Return to text
2. On August 23, 2013, the OCC announced that EverBank has agreed to pay approximately $37 million in cash payments to more than 32,000 eligible mortgage borrowers and an additional $6.3 million to organizations certified by the U.S. Department of Housing and Urban Development or other tax-exempt organizations that have as a principal mission providing affordable housing, foreclosure prevention and/or educational assistance to low- and moderate-income individuals and families. More information can be found on the OCC's website at http://occ.treas.gov/news-issuances/news-releases/2013/nr-occ-2013-126.html. Return to text
- Payment Agreement Details for Goldman Sachs and Morgan Stanley Borrowers (PDF)
- Payment Agreement Details (PDF) (April 9, 2013)
- Related Payment Agreement Announcements
- Amended Consent Orders
- Payment Agreement - Public Service Announcement
- Payment Agreement - Frequently Asked Questions
- Independent Foreclosure Review: Important Changes Audioconference
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