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Borrowers may get 2 checks in deals

By Polyana da Costa · Bankrate.com
Friday, April 19, 2013
Posted: 4 pm ET

Many of the borrowers who have received a check from Rust Consulting under the so-called foreclosure review settlement are wondering why their payments were less than the minimum $840 they were told they would get.

"Why did the paperwork promise a minimum of $800 per homeowner and now its $300?" one reader asks.

"On a letter I received it said that I would receive no less than $840," another reader writes.

Let's clarify the confusion.

A pair of settlements

There are two mortgage settlements in which borrowers will receive checks this year. The one that will pay borrowers a minimum of $840 is the National Mortgage Settlement, which resulted from negotiations between 49 state attorneys general, the federal government and five of the nation's largest banks. These payments have not been mailed out yet. (Oklahoma didn't participate in the settlement.)

The checks that borrowers are receiving now resulted from a settlement led by the OCC with 13 banks to halt the review of foreclosure files for borrowers who had homes in foreclosure in 2009 and 2010.

I'd like a double dip, please

  • Can you get a payment under both settlements?

If you meet the criteria for both, you may get two checks. Receiving a check for the foreclosure review settlement will not stop borrowers from receiving payment under the national mortgage settlement, says Geoff Greenwood, communications director for the Iowa attorney general.

Who's eligible for what?

  • National Mortgage Settlement payments totaling $1.5 billion:

This is for borrowers who lost their homes to foreclosure between 2008 and 2011 and had loans that were not owned by Fannie and Freddie and whose were serviced by one of the five lenders: Ally/GMAC, Bank of America, Citi, JPMorgan Chase and Wells Fargo.

Claim forms were mailed out to eligible borrowers last year, around September and October. Only borrowers who submitted claim forms will receive payments. The deadline to submit the forms was in January. This is different than having submitted a request to the OCC for a foreclosure review.

Based on the number of eligible borrowers and the $1.5 billion available for cash payments, borrowers who submitted a claim will receive a minimum of $840, but likely more because many borrowers probably didn't respond.

Regulators are in the final stages of processing the claims and the checks are expected to be mailed out by early summer, Greenwood said.

To make matters more confusing, the paying agent in both settlements is Rust Consulting. If you get mail from Rust Consulting, don't throw it away.

  • Foreclosure 'review' settlement payments totaling $3.6 billion:

This is for borrowers who were in foreclosure in 2009 and 2010 and whose loans were serviced by one of the 13 banks in the agreement. More than 4 million borrowers will receive checks ranging from $300 to $125,000. Most checks are less than $1,000. The majority of these checks will be sent by the end of April.

Here's what the payment envelope from Rust Consulting looks like.

Follow me on Twitter @Polyanad.

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106 Comments
arthur collins
April 26, 2013 at 2:24 pm

when will i recieve my settlement check

Dave
April 25, 2013 at 8:40 pm

what's right is wrong,and what's wrong is right.Hells Fargo,how do you sleep at night?

Ray Westphal
April 24, 2013 at 11:29 am

Jeanne, google Phillips and Garcia, they can represent you in your state if you have a case. They have no up front fees and do not get paid until you do. They are awesome and they helped me. Trust them 100% I am only saying if you have a case. I thought I was writting in a blog on their site and they Carlin Phillips called me at home on a Sunday and said he could help me and he did, OH BELIEVE ME! they did! Good luck

Ray Westphal
April 24, 2013 at 11:24 am

No check here yet Wednesday 4/24/13. Dont get your hopes up to high. I think this is all computer generated like our loans were. We are just another number not case by case with a name. Hmmm seems the government is doing what the banks did.

Jeanne
April 23, 2013 at 4:07 pm

I am a disabled person who got only $500. Why don't Fannie Mae folks get anything? They foreclosed on me after I attempted to get a Modification and I also filled bankruptcy. They foreclosed on me while I was ill. I think Wells Fargo is getting away everything they did to me. Any attorney in Colorado willing to take on my case?

Rick
April 23, 2013 at 4:01 pm

I got my check on 4-22-2013 for 800.00 no where near what they owed me but its better then a kick in the teeth.

Ray S. Linker
April 23, 2013 at 3:21 pm

How can I get off the e-mail list for Bankrate.com. I am tired to getting these messages. Thank you.

Shirley
April 23, 2013 at 12:56 pm

Anyone received their check. Do you know what order or who receives their checks first?

Roberto Adalid
April 22, 2013 at 1:20 am

I have 1st and 2nd loan and applying to modify both loan when the foreclosure happened. I was in a trial plan with my 2nd loan and at the same time my request are being denied. How do you categorize this case ???

mares
April 21, 2013 at 8:24 am

If borrower settles through agreement (modification) before trial in foreclosed suit, which borrower denied default, what amount should borrower receive? Who determines the category borrower falls under??

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