Understanding The Foreclosure Fraud Settlemennt

Updated 12/19/2012
Ladies and gentlemen, Fellow Americans, it has been a while since our last intervention in the mortgage scene. We are back here to to address the newly released settlement between the States, 49 of them, Oklahoma excluded and Five (5) banks:

GMAC/Ally: 800-766-4622
Bank of America: 877-488-7814
Citi Bank: 866-272-4749
JP Morgan Chase: 866-372-6901
Wells Fargo: 800-288-3212

Understand that this settlement does not address all the claims against these companies. The payment is for fraud committed during the foreclosure process only! Remember the cases where $10.00 per hour employees signed as Bank Vice Presidents? Where the claim against the homeowner could not always be proven? That is what this payment is for. Banks just did not wake up one morning and decided to return some of bailout money that they received.

First things to note: if you live in Oklahoma, or if your lender is not listed, you are out of luck. You need to look for other avenues. If your loan is owned by Fannie Mae or Freddie Mac, you are left out.

How much money involved in the foreclosure settlement?
$25 billions by all five banks + $1 billion to be paid solely by Bank of America on behalf of Countrywide.
That money is applied to three separate situations:

Paying the States that brought the lawsuit: A portion of the $25 billions will be paid to the 49 States, the rest, excluding the Countrywide $1 billion share, will be split as follows:

Loan Modification: $17 billions for principal reduction, and other forms of loan modification relief, that amount is compared to $700 billions of mortgages underwater. I guess you will say that something is better than nothing.
Refinancing Underwater Homeowners: $3 billions for relief nationwide. Again, there are eleven 11 millions homes underwater nationwide.

Lost homes in foreclosure: $1.5 billions to be split among 750,000 former homeowners. If you lost your home to foreclosure, you get $1,500 for the trouble, but your home has been taken away, you have been humiliated, and broken.
Other references: www.nationalmortgagesettlement.com. This government website has individual Attorney Generals contact information, as well as each individual member bank involved in this settlement.
Here is a question for you: Did crime pay for these and other lenders?

As always, your questions, comments and suggestions are strongly encouraged.