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Vermonters Receive $14.7 Million in Foreclosure Relief to Date Under National Settlement

CONTACT: Elliot Burg, Assistant Attorney General, (802) 828-5507

May 21, 2013

Vermont Attorney General William H. Sorrell announced today that Vermont homeowners received $14.7 million in foreclosure relief benefits during the first year of the 2012 state-federal settlement with the nation’s five largest mortgage servicers, Bank of America, J.P. Morgan Chase, Citigroup, Wells Fargo, and Residential Capital (GMAC/Ally). The settlement addressed foreclosure abuses and unacceptable nationwide mortgage servicing practices.

“These benefits directly help Vermonters who have faced foreclosure, and who in many cases have had problems with the companies that serviced their loans, such as delays, lost paperwork, and ‘dual tracking’ of foreclosures while loan modification applications were pending,” said Attorney General Sorrell. “They are in addition to major changes in the way servicers must conduct themselves as a result of the settlement, and go hand in hand with recent statutory changes that will continue making mediation available to homeowners in foreclosure.”

Among the categories of financial relief received by Vermonters under the settlement during the period March 1, 2012, though March 31, 2013, based on figures from the national settlement monitor, were these:

  • 257 borrowers benefited from some type of consumer relief, totaling $14.7 million, which, on average, represents about $57,000 per borrower.
  • 91 borrowers received some kind of first lien modification, totaling $5.5 million, such as a trial modification that was offered, or in process, or completed.
  • 82 borrowers received some kind of second lien modification, totaling $4.1 million.
  • 39 borrowers were offered or completed refinancing worth $2.4 million.
  • 32 borrowers received a “short sale” or “deed in lieu,” totaling $2.2 million.
  • The state-federal settlement stemmed from a massive civil law enforcement investigation by state attorneys general, state banking regulators, and nearly a dozen federal agencies. The settlement did not grant immunity from any crime, or from liability for other aspects of the mortgage crisis, including securities fraud. It also left homeowners and investors free to pursue legal action against the five servicers.

      Website consulting provided by The National Association of Attorneys General.