Big banks agree to $25 billion mortgage settlement; NH to get $43.6 million
CONCORD – Millions of dollars in relief are headed to New Hampshire homeowners and foreclosure victims under the record federal settlement announced this week by federal administrators.
Under the $25 billion agreement, announced Thursday by the U.S. Attorney General’s office, New Hampshire will receive $43.6 million to be spread among current and former homeowners who held their mortgages with the one nation’s five largest mortgage lenders: Bank of America, Citigroup, GMAC, JP Morgan Chase or Wells Fargo.
Each of these banks, which face claims of fraud and misconduct, acknowledged in the settlement “robo-signing” thousands of foreclosure documents without reviewing the accuracy of the papers.
Thousands of New Hampshire homeowners fell victim to this practice, according to state Attorney General Michael Delaney. And after Thursday’s settlement, they finally will begin to see some restitution, Delaney said Thursday as he announced the state’s participation in the settlement.
“Our citizens are struggling to stay in their homes and trying to restructure the terms of their loans, and they need help now,” he said during a press conference held at the Attorney General’s office.
“These monies will assist distressed homeowners to stay in their homes through enhanced loan modifications and refinancing, fund payments to victims of unfair foreclosure practices. … This is the largest joint federal-state civil settlement in history.”
Across the country, the settlement money could reach more than 1 million homeowners in 49 states, U.S. Attorney General Eric Holder said Thursday as he announced the settlement. Each state except Oklahoma signed on to the settlement.
The agreement, which officially will be filed in U.S. District Court later this month, also establishes a new set of federal standards for mortgage lending, consumer response and foreclosures that will help reduce fraud and abuse, federal officials said.
“We are using this opportunity to fix a broken system,” Holder said in a written statement.
In New Hampshire, which first joined the fight in 2010 as part of a working group of states investigating the banks, the state money will be spread among homeowners, foreclosure victims and others around the state.
Of the state funds, $19.4 million will go directly to homeowners to reduce mortgage rates, $11 million will remain with the state for housing assistance programs, and $4.5 million will go to residents who lost their homes to foreclosure.
Since 2008, more than 11,000 state families have lost their homes to foreclosure, according to the New Hampshire Housing Finance Authority. Many of these foreclosure victims could receive up to $1,800 each, according to state estimates.
“Nothing is cast in stone yet. The settlement itself covers so many different areas … it’s almost impossible to anticipate how many people it might affect,” said Jane Law, a spokeswoman for the housing finance authority. “But what I can say is anything that helps homeowners in this state is a very good thing.”
Moving forward, the settlement money will become available to state residents in coming months. Residents should contact the state banking or justice departments to see if they are eligible.
But the settlement dollars will not bring an end to the state’s efforts, said Delaney, the state attorney general.
The terms of the settlement do not prohibit further lawsuits, either criminal or civil, by individuals or state governments, and New Hampshire officials could join more settlements in the years to come, he said.
“This settlement is a substantial step but just one of many steps to address mortgage and foreclosure misconduct,” Delaney said. “We anticipate participating in additional cases against other culpable financial institutions.”
Jake Berry can be reached at 594-6402 or firstname.lastname@example.org.