Saturday
December 20, 2014

Report: 3 Banks Fail Mortgage Settlement Rules

|
-A A +A

Report: 3 Banks Fail Mortgage Settlement Rules

Three of the nation's largest banks are falling short of new standards for dealing with mortgage customers that were agreed to as part of a $25 billion settlement over improper foreclosures, according to a report released by the Office of Mortgage Settlement Oversight. 

In the first half of the year, Bank of America failed three of the 29 metrics designed to test compliance with 304 new mortgage servicing standards, the report states. JPMorgan Chase and Citigroup each failed two of the standards. The other two banks that were part of the settlement — Wells Fargo and the ResCap parties, formerly GMAC Mortgage and Ally Financial — did not fail any of the metrics in the first half of the year. 

One measure failed by Bank of America, JPMorgan, and Citigroup involved providing proper notification to customers that foreclosure proceedings were starting. Other problems by at least one bank were related to timely decisions on requests for modifications of monthly payments and short sales. 

"Broadly speaking, I think distressed borrowers are being treated better now than they would be if there wasn't a settlement," said settlement monitor Joseph A. Smith Jr., "but I don't think we're finished."

Source: "Three Large Banks Not Complying With Mortgage Settlement Changes," Los Angeles Times (Dec. 4, 2013)

Copyright © 2013 Information Inc.

Read more:

Fed Targets More Banks for Foreclosure Errors
Have We Learned Anything from the Financial Crisis?