Jefferson City, MO – August 31, 2012 – (RealEstateRama) — Attorney General Chris Koster announced today that Missouri has received more than $83 million from the joint state-federal mortgage settlement announced in February 2012.
“I am pleased to see that the banks have provided millions of dollars in relief to Missouri as promised – more than $83 million has already come to Missouri borrowers and to the state,” Koster said. “The mortgage relief allows homeowners to stay in their homes, relieves financial stress, and strengthens Missouri’s economy.”
Koster said the Missouri treasury received $38 million in a direct cash payment on July 17. In addition, as of June 30, nearly 1,300 Missouri borrowers received $45 million in relief including principal reductions, short sales, refinancing, and other borrower assistance programs for individuals whose homes are worth less than they owe.
In addition, relief valued at $28 million is currently in the process of being provided to Missouri borrowers as of June 30.
In general, Bank of America, Citigroup, JP Morgan Chase, Wells Fargo, and Ally Financial have offered eligible borrowers a trial modification for three months after which, if the homeowner successfully completes the trial period, the relief becomes final. The $28 million represents additional principal reductions, short sales, and other borrower assistance programs offered to borrowers who had not yet completed the trial process as of June 30.
The settlements with the five banks, which addressed allegations of foreclosure abuses, unfair mortgage-servicing practices, and fraud, were approved by a federal judge April 5.
“The figures released today are as of June 30, less than 60 days after the judge approved these settlements,” Koster said. “I expect the November report to reflect even more relief to Missourians, and to prove the success of Missouri’s settlement with the five major banks.”
In addition to the monetary relief the settlement has provided, the agreement also requires the five banks to implement more than 300 new standards for servicing mortgage loans. The new standards, which include a requirement that homeowners be given a single contact person with whom to discuss their loan modifications, offer greater protection for borrowers. The monitor’s report indicates that the settling banks had implemented between 35 and 72 percent of the servicing standards as of July 5.
“My office has aggressively enforced any reported violations of the servicing standards,” Koster said. “Our enforcement of these standards has helped Missourians stay in their homes, and I encourage anyone experiencing difficulties with one of the five banks to contact our mortgage hotline at 855-870-7676.”
The $45 million in borrower relief is detailed in a report issued by the independent monitor established to monitor compliance with the settlement. The report reflects data submitted by the five settling banks to the monitor. The next report, scheduled for release on November 14, 2012, will include verified data through September 30.
The five banks report that they provided more than $10 billion in relief to more than 130,000 consumers nationwide between March 1, 2012, and June 30, 2012.
Attorney General Koster noted the settlement also provides for a direct payment to homeowners whose homes were lost in foreclosure between January 1, 2008, and December 31, 2011, and whose loan was serviced by any of the five settling banks. This relief is not included in either the $45 million or the $28 million. A third-party administrator is currently working to compile current addresses for these foreclosure victims and the Attorney General’s Office anticipates reaching out to those individuals later this year.
Anyone who was foreclosed on between January 1, 2008, through December 31, 2011, should contact the Attorney General’s Office at ago.mo.gov or 855-870-7676 to register their contact information so the Attorney General can assist in obtaining that relief.