The Obama administration announced a settlement with the nations’ largest banks – Bank of America, Chase, Citigroup, GMAC/Ally, and Wells Fargo. This settlement culminates a year of effort on the part of the 50-state Attorney’s General lawsuit against mortgage loan servicers accused of wrongful foreclosures. As announced by Attorney General Bill Schuette on Tuesday, Michigan is slated to receive over $101M from the servicers, in addition to restitution paid directly to prior and current homeowners whose mortgages are held by these five banks. The settlement requires the bank mortgage servicers to provide the participating states, including Michigan, up to $25 billion dollars in monetary sanctions and relief. The total settlement amount is dependent on the number of states that sign the settlement agreement. In addition to the money relief, the settlement requires comprehensive reforms of mortgage loan serving.
The attached document is a one-pager, with information on the settlement. Questions should be directed to the website for the Attorney General at http://www.michigan.gov/ag instead of calling People can click on Consumer Protection on the left navigation bar, then under Highlights click on Mortgage Servicing Settlement FAQ’s.
Andy Schor is the Assistant Director of State Affairs for the Michigan Municipal League. Contact him at (517) 908-0300 or by email at [email protected].