|March 18, 2014
Contact: Whitney Ray
Phone: (850) 245-0150
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TALLAHASSEE, Fla. –Today, Joseph A. Smith, Jr., Monitor of the National Mortgage Settlement, filed with the U.S. District Court for the District of Columbia final credit reports on Bank of America, Chase, Citi, Rescap, and Wells Fargo announcing over $20 Billion in creditable relief to distressed homeowners. These reports confirm that the banks have satisfied their consumer relief and refinancing obligations under the Settlement. A summary report can be downloaded here, and a fact sheet is available here.
“The reports released today demonstrate that over 600,000 financially strapped families from across the country have benefitted from the relief required under the National Mortgage Settlement and more than $50 billion has been expended to provide this relief” stated Attorney General Pam Bondi. “I am very encouraged by what we have accomplished so far but I realize that there are still many Floridians facing the loss of their family homes and struggling to get back on their feet. My office will continue to work closely with these families and the settling banks to ensure full compliance with the settlement and that all required steps are taken to assist the families under the servicing standards of the settlement.”
The Monitor reported relief of $50.46 billion in gross dollar amounts provided to borrowers, which amounts to $20.6 billion in credit under the NMS, because the NMS does not credit all relief as dollar for dollar. The settlement was designed to provide more credit for certain types of relief, such as first and second lien modifications for occupied residences, and to ensure that more beneficial types of relief account for a larger percentage of the relief provided. The final report shows the breakdown of relief as follows:
· 52% of total was provided as first and second lien principle forgiveness to homeowners in default or at risk of default—first lien forgiveness amounts to 37% and second lien to 15%.
· 17% of the relief was provided as refinancing relief in the form of rate reduction assistance to homeowners who did not qualify for bank’s generally available refinance programs.
· 31% was provided in other forms of relief such as forgiveness of amounts in forbearance, waivers of amounts due on balances of mortgages after short sales or deeds in lieu of foreclosure, payments to borrowers above $1500 to assist borrowers in transition after short sale or deed in lieu of foreclosure, and other relief.
Of the total $50 billion gross dollars, more than 120,000 Floridians received over $9.22 billion in relief under the Settlement, with an average of $77,000 in relief per borrower, according to a previously released report. The $9.22 billion in bank-reported relief for Floridians exceeded the original estimate of homeowner relief by $800 million and accounts for 18 percent of the total national relief, second only to California.
The $20 billion in credited relief ($50 billion in gross dollar relief) to distressed homeowners is one component of the more than $25 billion settlement announced in 2012, by Attorney General Pam Bondi, 48 states and the U.S. Department of Justice with the five largest mortgage servicers—Bank of America, JP Morgan Chase, Wells Fargo, Citibank, and Ally Bank, formerly GMAC (RESCAP) settlement, In addition, the Settlement provided relief to foreclosed borrowers through the approximately $1.5 billion borrower payment fund (under which approximately 73,000 Floridians received $107 million in payments) and approximately $3.5 billion in payments to the states and federal government in penalties and funds for housing crises related expenses, of which Florida received $334 million. The Settlement also requires the banks to adhere to enhanced servicing standards for a period of approximately 3.5 years. In total, Florida received over $9.6 billion in relief under the settlement.
Click here to access National Mortgage Settlement website.
Click here to access Monitor Joseph Smith’s statement to learn more about the final credited relief amounts.