From the Office of the Comptroller of the Currency
Updated December 20, 2011
On April 13, 2011, the Office of the Comptroller of the Currency, the Board of Governors of the Federal Reserve System, and the Office of Thrift Supervision announced enforcement actions against 14 large residential mortgage servicers and two third-party vendors for unsafe and unsound practices related to residential mortgage servicing and foreclosure processing.
Independent Foreclosure Review
As part of those consent orders, federal regulators required servicers to engage independent firms to conduct a multi-faceted review of foreclosure actions in process in 2009 and 2010. Under the orders, independent consultants are charged with evaluating whether borrowers suffered financial injury through errors, misrepresentations, or other deficiencies in foreclosure practices and determining appropriate remediation for those customers. Where a borrower suffered financial injury as a result of such practices, the agencies’ orders require financial remediation to be provided.
As part of that program, the 14 mortgage servicers covered by the enforcement actions will begin mailings November 1, 2011 that will continue through the end of the year. The mailings are intended to provide information to potentially eligible borrowers on how to request a review of their case if they believe they suffered financial injury as a result of errors, misrepresentations, or other deficiencies in foreclosure proceedings related to their primary residence between January 1, 2009 and December 31, 2010. The mailings will include a request for review form.
Borrowers may also visit www.IndependentForeclosureReview.com for more information about the review and claim process. 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 from 8 a.m. to 5 p.m. (ET).
Requests for review must be received by April 30, 2012.
The third-party consultant will assess whether any errors, misrepresentations, or other deficiencies resulted in financial injury to borrowers. Where a borrower suffered financial injury as a result of such practices, the consent orders require remediation to be provided. During the review, customers may be contacted by mortgage servicers for additional information at the direction of the independent consultant.
Eligibility for Review
To be eligible, the mortgage must have been active in the foreclosure process between January 1, 2009, and December 31, 2010, the property securing the loan must have been the primary residence, and the mortgage must have been serviced by one of the following mortgage servicers:
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Engagement Letters
The OCC also released engagement letters that describe how the independent consultants, retained by the servicers, 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. See the engagement letters.
Interim Report
The report, “Interim Status Report: Foreclosure-Related Consent Orders,” summarizes progress on activities related to the independent foreclosure review announced November 1, 2011, as well as other activities to enhance mortgage servicing operations, strengthen oversight of third-party service providers and activities related to Mortgage Electronic Registration Systems (MERS), improve management information systems, assess and manage risk, and ensure compliance with applicable laws and regulations. Read the report.
Frequently Asked Questions
Consumers may have a number of questions regarding how these enforcement actions may affect them. The OCC has provided answers to some of the most anticipated questions in these frequently asked questions.
About the Enforcement Actions
The enforcement actions were based on interagency examinations conducted in the fourth quarter of 2010. A summary of the findings of the interagency reviews is available in the Interagency Review of Foreclosure Policies and Practices, which was produced by the OCC, the Board of Governors of the Federal Reserve System, and the OTS.
Links to the OCC and former OTS Enforcement Actions:
- Consent Order for Aurora Bank, FSB (PDF)
- Consent Order for Bank of America (PDF)
- Consent Order for Citibank (PDF)
- Consent Orders for EverBank and EverBank Financial Corp. (PDF)
- Consent Order for HSBC Bank (PDF)
- Consent Order for JPMorgan Chase Bank, N.A. (PDF)
- Consent Order for LPS; DocX, LLC; and LPD Default Solutions, Inc. (PDF)
- Consent Order for MetLife Bank, N.A. (PDF)
- Consent Order for MERSCORP and Mortgage Electronic Registration Systems, Inc. (MERS) (PDF)
- Consent Orders for OneWest Bank, FSB and IMB HoldCo LLC (PDF)
- Consent Order for PNC Bank, N.A. (PDF)
- Consent Order for Sovereign Bank (PDF)
- Consent Order for U.S. Bank National Association, U.S. Bank National Association ND (PDF)
- Consent Order for Wells Fargo Bank, N.A. (PDF)
Related Links
- Frequently Asked Questions Regarding the Independent Foreclosure Review
- Interagency Review of Foreclosure Policies and Practices (PDF)
- OCC News Release 2011-47, “OCC Takes Enforcement Action Against Eight Servicers for Unsafe and Unsound Foreclosure Practices”
- Federal Reserve News Release
- OTS News Release 11-008
Source “Correcting Foreclosure Practices” OCC (Dec 2011)