Oppenheim Law

Mortgage accord is touted - Sun-Sentinel

News   •   Aug 06, 2012 13:42 EDT

By Paul Owers, Staff writer

8:31 a.m. EDTAugust 6, 2012

U.S. housing officials last week unveiled a television ad and online tools to educate struggling homeowners about available help through the $25 billion national foreclosure settlement with big banks.

Still unclear, however, is how borrowers qualify for the aid.

"There's no simple, one-sentence explanation," Shaun Donovan, secretary of the Department of Housing and Urban Development, said in a conference call with reporters.

In February, Florida and 48 other states announced the landmark settlement with Bank of AmericaJPMorgan, Wells Fargo & Co.,Citigroup Inc. and Ally Financial Inc. The agreement followed disclosures that the lenders used faulty documents to repossess homes.

Some bank employees, called "robo signers," admitted under oath that they signed off on thousands of foreclosures without knowing the details.

As part of the settlement, 750,000 people nationwide are eligible for up to $2,000 each if they suffered mortgage servicing abuse while losing their homes to foreclosure from 2008 through 2011.

A settlement administrator designated by the state attorneys general will send claim forms to eligible homeowners, according to Florida Attorney General Pam Bondi's office.

Banks also will be required to reduce mortgage balances for 1 million homeowners nationwide. The average reduction is estimated at $20,000.

Florida's share of the settlement is more than $8 billion.

HUD has added a "homeowner help" section and a mortgage assistance guide to its HUD.gov website to show homeowners the various options for assistance.

Homeowners who think they may qualify are advised to call their individual mortgage servicer or a homeowner hot line at 888-995-4673. Details also are available online at NationalMortgageSettlement.com.

Some local housing observers say the settlement is forcing banks to be more responsive to homeowners, while others insist it's still business as usual.

"We've seen no precipitous change in the rewards our clients are getting," said Roy Oppenheim, a foreclosure defense lawyer in Weston.

Sunrise lawyer Gary Singer said the settlement allows banks to decide which loans will be included in the relief.

"It's not something that people can directly apply to," Singer said. "It's [the banks'] decision."

South Florida mortgages at risk of foreclosure fell roughly 6 percent during the past year, according to data from LPS Applied Analytics cited in a government housing scorecard for July. Still, as of May, the region ranks first nationwide in the share of mortgages in the foreclosure process or at least 90 days delinquent.

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