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  

• Payment Agreement Details (PDF)

Payments to 4.2 million borrowers are scheduled to begin on April 12 following an agreement reached by the Office of the Comptroller of the Currency and the Federal Reserve Board with 13 mortgage servicers. The agreement, which was reached earlier this year, provides $3.6 billion in cash payments to borrowers whose homes were in any stage of the foreclosure process in 2009 or 2010 and whose mortgages were serviced by one of the following companies, their affiliates, or subsidiaries: Aurora, Bank of America, Citibank, Goldman Sachs, HSBC, JPMorgan Chase, MetLife Bank, Morgan Stanley, PNC, Sovereign, SunTrust, U.S. Bank, and Wells Fargo.

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.

For borrowers with mortgage loans with the following servicers: Aurora, Bank of America, Citibank, Goldman Sachs, HSBC, JPMorgan Chase, MetLife Bank, Morgan Stanley, PNC, Sovereign, SunTrust, U.S. Bank, and Wells Fargo,¹  see: Payment Agreement.

For borrowers with mortgage loans with the following servicers: EverBank/EverHome Mortgage Company, Financial Freedom (OneWest), GMAC Mortgage, and IndyMac Mortgage Services (OneWest), the Independent Foreclosure Review process continues.

Background

The Federal Reserve Board issued enforcement actions against four large mortgage servicers
--GMAC Mortgage, HSBC Finance Corporation, SunTrust Mortgage, and EMC Mortgage Corporation--in April 2011. Under those actions, the four servicers were required to retain independent consultants to review foreclosures that were initiated, pending, or completed during 2009 or 2010. The review was intended to determine if borrowers suffered financial harm directly resulting from errors, misrepresentations, or other deficiencies that may have occurred during the foreclosure process.

A number of servicers supervised by the Office of the Comptroller of the Currency (OCC) were also required to conduct independent reviews. (See below for the full list of servicers.)

The deadline to request an independent review was December 31, 2012.

Eligibility for Independent Foreclosure Review

Borrowers were eligible for an independent foreclosure review if they met the following criteria:

• the property securing the loan was the borrower's primary residence;
• the mortgage was in the foreclosure process (initiated, pending, or completed) at any time between January 1, 2009, and December 31, 2010; and  
• the mortgage was serviced by one of the following mortgage servicers:

*These companies are participating in the Payment Agreement.

Eligible borrowers were sent a Request for Review form by mail starting in November of 2011 when the program launched.

If a borrower previously filed a complaint with these servicers about foreclosures pending during the review period, they were still eligible to file for an independent review of their foreclosure.

There were no costs associated with being included in the review; the review was a free program. Borrowers should beware of anyone requiring payments for assistance in connection with the Independent Foreclosure Review or any other foreclosure assistance program.

Federal Reserve's Role

The Federal Reserve's role is to ensure compliance with the enforcement actions issued in April 2011, including the payment process under the agreement in principle announced in January of 2013.

OCC and Federal Reserve examiners are continuing to closely monitor the servicers' implementation of plans required by the enforcement actions issued in April 2011 to correct the unsafe and unsound mortgage servicing and foreclosure practices.

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