$145 million mortgage rescue headed to IN

  • 2 min to read
$145 million mortgage rescue headed to IN

 

By Lesley Weidenbener

Indiana's share of a

mortgage settlement between 49 states and five banks will be about $145 million

to be used primarily for homeowner loan refinancing and modifications, cash

payments for borrowers who lost homes, and consumer protection programs.

Indiana

Attorney General Greg Zoeller

said Thursday that

the settlement offers "immediate help to many

people in Indiana and also allows an opportunity for the national housing

market to recover from the crisis of 2008, hopefully sooner rather than

later."

"The prolonged

recession has caused great financial hardship in the form of mortgage

foreclosures, bankruptcies and unemployment," Zoeller

said. "This resolution, while not everything we had wanted, speeds help to

Hoosiers and for the economy as a whole."

Overall, the settlement

with Ally, Bank of America, Citi, JPMorgan Chase and

Wells Fargo will provide a minimum of $26 billion in relief to distressed borrowers

and direct payments to states and the federal government. The agreement stems

from what state attorneys general have called abuses and fraud in the

foreclosure area as well as "unacceptable nationwide mortgage servicing

practices."

Zoeller joined President

Barack Obama

on Thursday in Washington D.C. for the announcement about the

settlement. Obama said the deal will "speed relief to the hardest-hit

homeowners, end some of the most abusive practices of the mortgage industry,

and begin to turn the page on an era of recklessness that has left so much

damage in its wake.

The agreement resulted

from a civil law enforcement investigation and initiative that includes state

attorneys general and state banking regulators across the country as well as

nearly a dozen federal agencies. State officials said loan servicers routinely

signed foreclosure-related documents outside the presence of a notary public

and without knowing whether the facts they contained were correct — an

action known as robo-signing.

The settlement provides

benefits to borrowers whose loans are owned by the settling banks as well as to

many of the borrowers whose loans they administer. Zoeller

said the settlement will result in reduced loans to

benefit homeowners who are behind on their payments and who are

"underwater" or owe more than their homes are worth.

"We will be

dedicating more resources to our homeowner protection unit and consumer

protection divisions while also providing guidance to the legislature on

programs that additional settlement funds can comply with the spirit of the

mortgage settlement," Zoeller said in a

statement.

The final agreement,

through a consent judgment, will be filed in U.S. District Court in Washington,

D.C., and will have the authority of a court order.

Some of the banks and

mortgage services plan to contact borrowers directly regarding loan

modification options. However, Zoeller urged

borrowers to contact their mortgage servicers to obtain more information about

specific loan modification programs and whether they qualify under terms of

this settlement:

Bank of America: (877)

488-7814

Citi: (866) 272-4749

Chase: (866) 372-6901

GMAC: (800) 766-4622

Wells Fargo: (800)

288-3212

Loans owned by Fannie

Mae or Freddie Mac are not affected by this

settlement. Individuals can visit www.fanniemae.com/homeaffordable

or www.freddiemac.com/avoidforeclosure to see if their loan is owned by either group.

Individuals can soon

visit the website –www.NationalForeclosureSettlement.com– to find out more information.

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