Mortgage firms to pay $9.3 billion to settle foreclosure complaints

Mortgage firms to pay $9.3 billion to settle foreclosure complaintsUnder an agreement, thirteen mortgage service providers have agreed to pay $9.3 billion to settle customer complaints over the foreclosure-processing and loan-servicing methods used by the companies in the US.

The Office of the Comptroller of the Currency (OCC) and the Federal Reserve have announced the details of the final agreement on Thursday under which the mortgage providers would pay customers to settle outstanding federal complaints. The mortgage companies were accused of using improper foreclosure methods in 2009 and 2010, putting borrowers in disadvantageous position.

Aurora, Bank of America, Citibank, Goldman Sachs, HSBC, JPMorgan Chase, MetLife Bank, Morgan Stanley, PNC, Sovereign, SunTrust, U. S. Bank, and Wells Fargo have agreed to pay a combined $9.3 billion in settlement under the final agreement. OCC and the Fed said that out of total, $3.6 billion will be paid in cash to the borrowers and the remaining $5.7 billion will be provided through other assistance to borrowers.

Experts say that the banks can help struggling home owners with the agreement money and this will be positive news for the recovery of the American housing market. The Federal Reserve said has said that the new mortgage settlement agreement reached with a host of lenders is likely to help the home owners, who had to deal with improper foreclosures. The settlement includes 4.2 million people whose homes faced foreclosure in 2009 or 2010 and whose mortgages were managed by any of these companies.

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