Mortgage Servicers to Offer Independent Review of 2009-2010 Home Foreclosures

Nov 01, 2011, 10:04 ET from Housing Policy Council



WASHINGTON, Nov. 1, 2011 /PRNewswire-USNewswire/ -- Fourteen U.S. mortgage servicers and their affiliates are making available free, impartial Independent Foreclosure Reviews to certain of their borrowers as part of the consent orders entered into with the Board of Governors of the Federal Reserve System and the Office of the Comptroller of the Currency in April 2011. The reviews will be conducted by independent consultants upon request by borrowers who faced a foreclosure action on their primary residence during the period of Jan. 1, 2009 through Dec. 31, 2010.

If eligible borrowers believe that they were financially injured as a result of servicer errors, misrepresentations or other deficiencies in the foreclosure process, they can request a review of their foreclosure file to verify that their foreclosure process was handled properly. Foreclosure actions that may be eligible for a review include: 

  • Property sold due to a foreclosure judgment.
  • Mortgage loans referred into the foreclosure process but removed from the process because payments were brought up-to-date or the borrower entered a payment plan or modification program.
  • Mortgage loans referred into the foreclosure process, but the home was sold or the borrower participated in a short sale, or chose a deed-in-lieu or other program to avoid foreclosure.
  • Mortgage loans referred into the foreclosure process and remains delinquent but the foreclosure sale has not yet taken place.

If financial injury is found through a review, borrowers could receive compensation or other remedy.

"Servicers, regulators and independent consultants have created a process that will assess whether a borrower incurred financial injury due to servicer errors, misrepresentations, or other deficiencies in the foreclosure process," explained Paul Leonard, vice president of The Financial Services Roundtable's Housing Policy Council, a trade organization speaking on behalf of the participating servicers.  "The participating mortgage servicers remain committed to helping borrowers remain in their homes and have been working with federal banking regulators to resolve the issues raised in the consent orders.

"Because the review process will be available to a large number of potentially eligible borrowers at the 14 participating servicers, and will be a thorough and complete examination of many details and documents, a review could take several months to complete," added Leonard.

How the process works:

Borrowers potentially eligible for the Independent Foreclosure Reviews will be given the opportunity to submit a Request for Review Form.  An estimated 4.5 million borrowers will be notified by a letter explaining the review process and a Request for Review Form, along with a postage-paid return mailer, and by a national advertising campaign directing borrowers to for additional information

The mailings will be staggered—to better manage volumes—in stages beginning Nov. 1, 2011. To participate in an official review, eligible borrowers must submit a completed Request for Review Form by April 30, 2012. The form will ask the borrower to provide information on the property, the borrower and any co-borrowers, and responses to questions about how they believe they may have been financially injured.

There is no charge to eligible borrowers for a review, which will not be reported to any of the credit bureaus and will not impact any other options a borrower may pursue related to their foreclosure.

Once a completed Request for Review Form is submitted, the Independent Foreclosure Review process will:

  • Send an acknowledgment to the borrower within a week of receiving a request form;
  • Review requests that meet eligibility requirements to determine whether the borrower experienced financial harm as a result of errors, misrepresentations or deficiencies in the foreclosure process; and,
  • Notify the borrower of the findings (this could take up to several months).

Information may be found at  Borrowers who believe they may be eligible for a review who do not receive a mailing can call 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 to determine if they are eligible.

Throughout this process, servicers will continue their efforts to help homeowners who have not yet gone through a foreclosure sale stay in their homes, where possible.

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. 

SOURCE Housing Policy Council