BOSTON, Aug. 1, 2017 /PRNewswire/ -- Goldman Sachs has satisfied 40 percent of its $1.8-billion consumer-relief obligation under its two April 11, 2016, mortgage-related settlement agreements with the U.S. Department of Justice and three states, Eric D. Green announced today in his fourth report as independent Monitor of the consumer-relief portions of the agreements.
During the period since the Monitor's previous report on May 1, 2017, Goldman Sachs provided borrowers with a total of nearly $90 million of principal forgiveness involving two categories of loans. The bank received conditional credit of $80.2 million for these activities. Together with amounts claimed and validated in the Monitor's earlier reports, the total amount of cumulative credit conditionally validated by the Monitor comes to $724.5 million, or 40 percent of the required $1.8 billion.
The two agreements settled potential and filed legal claims against Goldman Sachs regarding the marketing, structuring, arrangement, underwriting, issuance and sale of mortgage-based securities. Besides the Department of Justice, California, Illinois and New York, Goldman Sachs reached settlements with the National Credit Union Administration Board and the Federal Home Loan Banks of Chicago and Des Moines. Under the settlements, Goldman Sachs agreed to provide a total of $5.06 billion, including consumer relief valued at $1.8 billion to be distributed by the end of January 2021.
"I am pleased to be able to report that Goldman Sachs has taken another major step toward meeting its obligation," Professor Green said.
The specific relief that Goldman Sachs provided in the most recent period included forgiveness of the balances due on 343 first lien mortgages, for total principal forgiveness of $38,255,616, average principal forgiveness of $111,532 per loan, and total reportable credit of $57,454,373 after the application of appropriate crediting calculations and multipliers. A detailed explanation of how crediting calculations and multipliers work can be found in Appendix 3 to today's report. The modified mortgages are spread across 38 states and the District of Columbia, with 32 percent of the credit located in the settling states of New York, Illinois, and California. Notably, 57 percent of the credit is for forgiveness of loans located in Hardest Hit Areas, census tracts identified by the U.S. Department of Housing and Urban Development as containing large concentrations of distressed properties and foreclosure activities.
Goldman Sachs also received credit in the most recent period for the extinguishment of 625 second lien loans. The total principal forgiven on these loans was $51,050,951, with an average principal forgiveness of $81,682 and total reportable credit of $22,762,823 after the application of appropriate crediting calculations and multipliers. The loans are located in 47 states and the District of Columbia, with 46 percent of the associated credit in the three settling states and 47 percent in Hardest Hit Areas.
Professor Green, a professional mediator and retired Boston University law professor, was named by the settling parties as independent Monitor with responsibility for determining whether Goldman Sachs fulfills its consumer-relief obligations. He has assembled a team of finance, accounting and legal professionals to assist in the task.
The report is available at the Monitor's website at: http://goldmansachs.mortgagesettlementmonitor.com. The website provides further details about the settlement, plus contact information for Goldman Sachs, the Department of Justice, the Attorneys General of California, Illinois and New York, and agencies that provide legal or tax advice to consumers.
The Monitor's mailing address is: Monitor of the Goldman Sachs Mortgage Settlement, P.O. Box 10310, Dublin, OH 43017-5910, and the e-mail address is email@example.com.
SOURCE Monitor: Eric D. Green