A $25 billion settlement joined by 49 states’ attorneys general and the federal government against five top loan services could benefit residents in Jefferson County.
Extensive investigation into five banks — Wells Fargo, Bank of America, Ally/GMAC, Citibank, and JP Morgan Chase — show extensive abuses relating to how loans were serviced by the banks after they were made.
Heather Connolly, assistant attorney general in West Virginia, said even if those lenders do not operate in Jefferson County, there is still an effect on Jefferson County residents.
“First, many home loans are transferred among banks, either through sale, acquisition, merger or bankruptcy,” Connolly said, adding many borrowers use out-of-county banks.
Among the relief won in the settlement was a first-ever servicing standards, sometimes referred to as a “borrowers bill of rights.” Also, there will be money for homeowners who have already been foreclosed upon from Jan. 1, 2008 to Dec. 31, 2012, money for refinancing for underwater but current borrowers, money for banks to use to modify loans of distressed homeowners who are in default and facing foreclosure, and money for state attorneys general to use for housing-related expenses, settlement implementation and legal services.
Connolly said the aim is to help stabilize the housing market, which improves neighborhoods by reducing the blight of abandoned buildings, foreclosed properties and lower home values.
West Virginia’s share is $33.8 million.
Connolly said the AG’s office is planning to hold housing fairs in the near future to explain what is available for relief to homeowners affected.
“We will walk people through the process. We can act as their representative,” Connolly said.
For information or to discuss a housing situation, call 800-368-8808.
This settlement is not the only one that will come through the attorney general’s office.
Connolly said discussion is currently under way with nine other banks, which will be the next “chunk of the market.”