Investigation - Foreclosure Settlement Money - Dallas News | myFOXdfw.com

Investigation - Foreclosure Settlement Money

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Some relief is on the way for homeowners who lost houses to foreclosure during the past few years.  Part of the government's 25 billion dollar settlement with servicers is going out next week.

There are two separate settlement funds for homeowners and the state of Texas got a chunk as well.  Millions of homeowners are part of the payout but the dollar amounts so far have been disappointing to many and collecting can be quite a headache.

"I call them every two days, just to waste their time because they are wasting mine," said Gwendolyn Thompson who lost her home in 2009.  Thompson is furious and fed up.  Adding insult to injury, she can't get answers from the Independent Foreclosure Review about what happened to her settlement check.

"You told me it was 7-10 days but on Monday it will be a month so where am I in your process?" she asked a customer service representative on the phone.
 
Thompson learned her check went to the wrong address. For weeks, she has been trying to get the paying agent to send a change of address form. She gets the same response. They don't have the answer. Then she is placed on hold.
 
"I don't understand why print and mail is so hard," said Thompson.  "Print the form and put it in the mail."
 
The Independent Foreclosure Review involves 3.6 billion dollars. It was divided among 4.2 million homeowners who lost homes involving 13 mortgage servicers. They include: Aurora, Bank of America, Citibank, Goldman Sachs, HSBC, JPMorgan Chase, MetLife Bank, Morgan Stanley, PNC, Sovereign, SunTrust, U.S. Bank, and Wells Fargo.
 
The payments started going out in mid-April and range from $300 to $125,000. The settlement has been called an expensive and lengthy debacle.  Senator Elizabeth Warren of Massachusetts hammered regulators at a recent hearing before the Senate Banking Committee.  She believes homeowners should get all the information about what servicers did illegally so they can use that information if they decided to sue. 
 
"So I just want to make sure I got this straight," Warren said.  "Families get pennies on the dollar in the settlement for having been the victims of illegal activities or mistakes in the banks' activities.  You now know individual cases where the banks violated the law and you're not going to tell homeowners or at least it is not clear yet whether or not you are going to do that?"
 
"We have not made a decision about telling the homeowners," said Richard Ashton of the Federal Reserve.
 
While lawmakers debate that issue, another distribution is coming from the National Mortgage Settlement. Homeowners were supposed to get around $840 each but that increased to $1480.  Those checks start going out the week of June 10, 2013.  Texas also got $134 million as part of the settlement.
 
"This is absolutely a golden opportunity," said Robert Doggett, an Austin attorney who works for Texas RioGrande Legal Aid.  Doggett had hoped the money would go to homeowners but Fox 4 has learned lawmakers decided the money should go into the general fund.
 
"They have money that could help me at least pay a bill or pay rent," said Gwendolyn Thompson.  Thompson says she isn't going to stop calling about her share of the settlement. She says she knows it probably isn't much considering what she lost but right now anything could help.  "It matters when you are struggling, it matters."
 
A spokesman for the Independent Foreclosure Review told Fox 4 there have been issues with change of address forms but they will be going out next week. If you believe you qualify for a pay out and have not received a check, homeowners should follow up.
 
For information about the National Mortgage Settlement go to:
 
 
For information about the Independent Foreclosure Review go to:
 
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