Maryland Joins National Mortgage Settlement
The state of Maryland has entered into a landmark legal settlement with the nation’s largest mortgage lenders to provide relief to homeowners who were victims of mortgage fraud. In what is being billed as the largest-ever deal, the settlement could help over a million struggling homeowners in the United States and expects to bring in $1 billion in aid to Maryland.
The mortgage deal settles state and federal findings that the nation’s largest mortgage providers routinely signed Foreclosure documents or “robo-signed” without the presence of a notary or knowing if the facts of the documents were correct.
Maryland Attorney General Douglas F. Gansler told the Baltimore Sun the settlement was the “biggest thing to happen” since Maryland and other states settled with tobacco companies in 1998 over questionable marketing tactics. He also praised the mortgage settlement and said it is the right move for struggling Maryland homeowners. In exchange for the settlement, Gansler and other state attorneys general will relinquish civil liability claims.
The $25 billion settlement with Bank of America, Wells Fargo, JP Morgan Chase, Citigroup and Ally Financial was reached with 49 states and will bring much needed assistance to over 40,000 Maryland homeowners who lost their homes to Foreclosure or are still at risk of foreclosure. The deal will mainly focus on partial loan forgiveness but offers up to $2,000 to homeowners who were foreclosed upon during the mortgage crisis. The mortgage settlement sets up four areas of assistance for Maryland homeowners with the exact amounts still being worked out:
- Around $800 million to reduce the principal for homeowners at risk of Foreclosure
- $60 million to reduce interest rates for borrowers who owe more than their homes are worth
- $60 million for the Maryland Attorney General’s office for housing related projects including 10% of that total for paying housing counselors and offering legal assistance to homeowners
- An estimated $25 million to write checks for $1,800 to $2,000 to Maryland homeowners who lost their homes to Foreclosure
As mentioned above, in exchange for the settlement, Gansler and other states attorneys general will give up civil liability claims against banks; however, homeowners who receive a payout from the settlement will still retain the right to sue banks for engaging in inappropriate Foreclosure processes. Federal officials have noted the settlement will not prevent them from investigating the housing bust further.
For more information on the mortgage settlement, contact Contact Maryland HOPE at 877-462-7555 or click on http://www.nationalmortgagesettlement.com/
