Major banks involved in the bollixed foreclosure review program will finally be sending checks to borrowers who were harmed by their servicing practices.
The Office of Comptroller of the Currency and Federal Reserve Board said Tuesday the first wave of checks will be sent to 1.4 million borrowers on April 12. The payments will range from $300 to $125,000.
Some of the borrowers will receive a letter from the paying agent—Rust Consulting—requesting additional information to process their payments.
Overall, 4.2 million borrowers are expected to receive $3.6 billion in compensation from 13 servicers—Aurora, Bank of America, Citibank, Goldman Sachs, HSBC, JPMorgan Chase, MetLife Bank, Morgan Stanley, PNC, Sovereign, SunTrust, U.S. Bank and Wells Fargo.
More than 90% of the total payments will be sent by 11 servicers by the end of April.
“Information about payments to borrowers whose mortgages were serviced by Goldman Sachs and Morgan Stanley will be announced in the near future,” according to a joint statement by OCC and FRB.
The regulators have been roundly criticized for the handling of the
On Thursday, a Senate Banking subcommittee will hold a hearing on the management of the foreclosure review process and the role played by consultants. Federal regulators along with officials from the Promontory Financial Group and PricewaterhouseCoopers are scheduled to testify.
