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Frequently Asked Questions Regarding the Interagency Foreclosure Enforcement Actions
Updated June 21, 2012
On April 13, 2011, the Office of the Comptroller of the Currency, the Office of Thrift Supervision, and the Board of Governors of the Federal Reserve System announced enforcement actions against 14 large residential mortgage servicers and two third-party vendors for unsafe and unsound practices related to residential mortgage loan servicing and foreclosure processing.
Below are answers to common questions regarding the enforcement actions.
Q. Who can I talk to now about my situation in light of your consent orders?
A. Customers may also visit Independent Foreclosure Review for more information. Assistance with the form and answers to questions about the process are available at 1-888-952-9105, Monday through Friday from 8 a.m. to 10 p.m. (ET) and on Saturday from 8 a.m. to 5 p.m. (ET).
Q. How can I request that my foreclosure be reviewed?
A. Information about the process is being provided in mailings to eligible borrowers that began November 1, 2010. The mailings should be completed by the end of the year. Customers may also visit Independent Foreclosure Review for more information. Assistance with the form and answers to questions about the process are available at 1-888-952-9105, Monday through Friday from 8 a.m. to 10 p.m. (ET) and on Saturday from 8 a.m. to 5 p.m. (ET).
Q. My house will be sold through foreclosure proceedings in the next few weeks. Will your enforcement order prevent that action?
A. The orders are intended to ensure that borrowers are treated fairly, especially those subject to foreclosure, but they are not intended to keep lawful foreclosures from proceeding. The independent consultants and servicers have identified loans that have been scheduled for foreclosure sale. Requests for review from eligible borrowers whose loan is scheduled for foreclosure sale will receive highest priority for review. If you believe you were improperly foreclosed upon or have been unfairly denied a modification and you are facing imminent foreclosure, you should contact your servicer if you have not done so already; or you can also contact our Customer Assistance Group at helpwithmybank.gov if you wish to file a complaint against a national bank servicer.
Q. Will foreclosure processing be postponed while borrowers' cases are reviewed under the consent orders?
A. The submission of a request for review form will not automatically postpone further foreclosure processing. However, the borrower will receive expedited attention where a foreclosure sale is imminent. This review will involve a case-by-case assessment of the borrower's individual circumstances and any legal requirements to determine if a foreclosure sale may be postponed or halted if the facts warrant. Borrowers who are facing imminent foreclosure are strongly encouraged to continue to work with their servicers directly and to avail themselves of all avenues of relief.
Q. I’m still working with my servicer to prevent a foreclosure sale. Will I still be able to work with them?
A. Yes, continue to work with your servicer. Participating in the review will not impact any effort to prevent a foreclosure sale. The review is not intended to replace current active efforts with your servicer.
Q. Do I need an attorney to request or submit the request for review form?
A. No. The independent foreclosure review is free. Beware of anyone who asks you to pay a fee in exchange for a service to complete the Request for Review Form. However, if your mortgage loan meets the initial eligibility criteria and you are currently represented by an attorney with respect to a foreclosure or bankruptcy case regarding your mortgage; please refer to your attorney.
Q. If I request an independent foreclosure review, is there a cost or will there be a negative impact to my credit?
A. The Independent Foreclosure Review is a free program. Beware of anyone who asks you to pay a fee in exchange for a service to complete the Request for Review Form. The review will not have an impact on your credit report or any other options you may pursue related to your foreclosure.
Q. How did the OCC ensure independence of the consultants and law firms hired by the servicers to conduct and support the independent reviews?
A. The OCC and the Federal Reserve Board reviewed consultants and law firms proposed by the servicers, their existing and previous relationships with the servicers and roles in foreclosure issues to prevent conflicts of interests and situations that could result in undue influence over their independent judgment.
Q. What is the OCC's role in the independent foreclosure review?
A. The OCC and the Federal Reserve Board required corrective action to address unsafe and unsound mortgage servicing and foreclosure processing among 14 large mortgage servicers. The federal regulators’ role is to ensure compliance with those consent orders through oversight and direction. As required by the consent orders, independent consultants will conduct the reviews of foreclosures, and determine whether errors, misrepresentations, or other deficiencies resulted in financial injury. Where a borrower suffered financial injury as a result of such practices, the consent orders require that remediation be provided. The regulators have spent significant amount of time to ensure a integrated claims process is simple, clear and fair and that the reviews are conducted consistently across servicers in an independent manner.
Q. My foreclosure sale was in 2011 but the process began in 2010, am I still eligible to have my foreclosure reviewed?
A. Yes, if the foreclosure activity was in process at any point in 2009 or 2010, if it involved your primary residence, and if the mortgage was serviced by one of the participating servicers.
Q. What mortgage servicers were involved in the independent look back review of foreclosures?
A. Foreclosure activities on a borrower’s primary residence conducted between January 1, 2009 and December 31, 2010 by the following mortgage servicers are eligible for review:
Q. When will I know the results of the review?
A. Individuals will be sent an acknowledgement letter within one week after the request is received. A review could take several months, because the review process will be a thorough and complete examination of many details and documents. Individuals will be notified in writing of the results of their review.
Q. I filed for bankruptcy. Am I to assume my foreclosure should not have proceeded?
A. Not necessarily, as filing bankruptcy does not prevent foreclosure proceedings in all cases. If you suspect you were improperly foreclosed upon while under protection from U.S. bankruptcy law, you may want to consider requesting a review through the independent review process required by federal regulators' consent orders. You may also want consult your personal bankruptcy lawyer.
Q. Are your actions against servicers aimed at foreclosure prevention?
A. The orders are intended to ensure that borrowers facing foreclosure are treated fairly, but they are not intended to keep lawful foreclosures from being initiated or proceeding. The enforcement actions, which were announced in April by the OCC, the Office of Thrift Supervision, and the Board of Governors of the Federal Reserve System specifically address mortgage servicing standards for loan modifications. The orders specifically require a single point of contact for borrowers, eliminate dual tracking in cases where a trial or permanent modification has been approved, and require adequate staffing of servicer loss mitigation programs. While not all foreclosures can be prevented, these changes are expected to eliminate confusion and frustration for homeowners trying to save their homes, and ensure that they are treated fairly and afforded every protection available under law
Q. I understand there will also be sample loan files pulled for review as part of a "look-back" by the third-party consultants for each of the servicers under the Consent Orders. What if the sampling method used by the third-party consultants conducting the "look back" misses me?
A. Sampling is only one of the methods that will be employed in the review. You can ask that your case be reviewed as part of the look back process if you think you suffered financial injury as a result of errors, misrepresentations, or other deficiencies in a foreclosure action on your primary residence that occurred in 2009 or 2010. Mailings to eligible borrowers explaining that request process began November 1, 2011 and will be completed by the end of the year. Borrowers may also visit Independent Foreclosure Review for more information. Assistance with the form and answers to questions about the process are available at 1 (888) 952-9105, Monday through Friday from 8 a.m. to 10 p.m. (ET) and Saturday 8 a.m. to 5 p.m. (ET). Requests must be postmarked or submitted online by September 30, 2012.
Q. I was more than six months delinquent on my mortgage. Can people like me expect remediation?
A. Remediation will be based on documented financial harm stemming from improper foreclosure practices by the servicer. If a foreclosure activity on your primary residence was in process at any point in 2009 or 2010, your mortgage was serviced by one of the participating servicers, and if you believe you have been financially harmed by improper foreclosure practices involving errors, misrepresentations, or other deficiencies, you should consider requesting a review through the third-party review process required by the enforcement actions.
Q. How do you repair my ruined credit?
A. Remediation may include the correction of information reported to credit bureaus. Eligible borrowers who think they have been financially harmed by errors, misrepresentations, or other deficiencies in a foreclosure process on their primary residence during 2009 and 2010 should consider requesting a review through the third-party review process required by the enforcement actions taken by the OCC and the Board of Governors of the Federal Reserve System.
Q. Can I contest the remedy I am given?
A. The enforcement orders provide additional rights to borrowers who may have been harmed by inappropriate or unfair practices by bank servicers, but they do not take any rights away from borrowers. If you are not satisfied with the remediation offered through the process the agencies have set up, you may still avail yourself of any legal remedies you now have.
Q. What kind of remedy can you provide for people who unfairly lost their homes as a result of illegal or inappropriate servicing practices?
A. The primary goal of remediation is to identify and compensate individuals who were financially injured by improper foreclosure actions. Compensation or remediation must be based on the individual facts of each case, and recommendations will all be made by the independent consultant. Final remediation plans will be subject to review by the OCC and the Board of Governors of the Federal Reserve System.
Q. Are you going to mandate principal reductions? Might the AG settlement do that?
A. OCC supports principal reduction as part of a servicer's tool kit to provide sustainable modifications provided they generate a higher net present value for mortgage investors. However, the OCC is not imposing mandatory principal reductions.
Q. My foreclosure action occurred before January 1, 2009. Am I out of luck?
A. As long as foreclosure action involved your primary residence and was active during any part of January 1, 2009 through December 31, 2010 and the mortgage was serviced by one of the participating servicers; you may be eligible for a review. The heavy foreclosure activity during those years exacerbated the deficiencies found in the examinations that were conducted in the fourth quarter of 2010, which is why we focused on that period of time. However, if you believe your servicer engaged in inappropriate or unfair practices with respect to your foreclosure, you still have all of your rights to seek civil remedies outside of the requirements of the enforcement action.
Q. What information will people need to provide to request a review?
A. The form will require information on the borrower and responses to questions about how the borrower believes he or she may have been financially injured. There is no charge to customers for a review. The review will not be reported to any of the credit bureaus and will not affect a customer’s efforts to pursue options related to a foreclosure.
Q. What constitutes financial injury?
A. Listed below are examples of situations that may have led to financial injury. This list does not include all situations.
Q. How can we get copies of the engagement letters that describe how the independent consultants will conduct their file reviews and claims processes to identify borrowers who suffered financial injury as a result of deficiencies identified in the OCC’s consent orders?
Q. Who is Rust Consulting?