For Florida homeowners receiving checks through the Independent Foreclosure Review Payment Agreement, the money may feel inadequate, to say the least. Many foreclosures during the 2009 to 2010 period were the direct result of predatory lenders looking to take advantage of borrowers in difficult circumstances and essentially steal their home equity. Lenders used a dual-track process, in some cases, to foreclose on a home even while negotiating a loan modification with the owner. Millions of Americans lost their homes due to this and other underhanded tactics, including the imposition of additional fees.
The Office of the Comptroller of the Currency reported that a third set of over 200,000 checks were mailed on the second of May, and the final checks are due to be mailed this summer. The settlement reached with 13 mortgage servicers totaled $3.6 billion. According to one homeowner in receipt of a $3,000 check, the money is incapable of undoing the “heartache we experienced in having our house sold out from under us.”
The director of an advocacy organization for housing policy reform stated that the “meager funds” do not begin to address the damage caused by predatory lenders. Many of the foreclosures were issued against owners serving in the military, maintaining current payments on their homes and under the supposed protection of bankruptcy.
Homeowners facing a financial situation that could result in foreclosure may benefit from filing for bankruptcy. This form of debt relief offers a number of mandatory federal and state exemptions as well as the ability to negotiate a property exemption plan. Anyone in danger of missing scheduled payments may be able to find protection with the assistance of attorney experienced in bankruptcy law.
Source: The Press-Enterprise, “REAL ESTATE: Frustration levels rise over mortgage settlement checks”, Debra Gruszecki, May 06, 2013