States, Banks Reach Foreclosure-Abuse Settlement: Who Benefits?

By: KKTV
By: KKTV

Mortgage lenders reached a $25 billion settlement with 49 states Thursday over foreclosure abuses.

The question many people are now asking: who gets money from that massive settlement?

An estimated 2 million people are expected to receive help from the settlement, although it could take six to nine months to be notified. All eligible people will receive notification through the mail.

People who got their loans through Bank of America, Citi Bank, JPMorgan Chase, Wells Fargo and Ally will be eligible to have the amount of their loan reduced, or receive help with financing. Those who got a government loan through Fannie Mae and Freddie Mac do not qualify.

Even after receiving notice of eligibility, it still could be awhile before seeing any money--lenders have three years to fulfill the terms of the deal

Oklahoma was the loan holdout in the settlement, and will not receive any money.


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  • by Larry Location: Ellicott on Feb 9, 2012 at 12:49 PM
    So who gets this money, the state governments or the people that lost thier homes?
  • by Annie Mosity on Feb 9, 2012 at 06:04 AM
    They get your house and you get ten dollars. Sounds fair.
    • reply
      by Lorelei on Feb 9, 2012 at 11:38 AM in reply to Annie Mosity
      good pseudo!!!what a pessimist you must be! I see here a victory of the Occupy Wallstreet movement, as some of the banks who rob the 99% are starting to give back what they stole...This, to enlighten the obtuse who questioned and criticized the folks who actually took the street to defend all's financial betterment.
      • reply
        by Annie Mosity on Feb 9, 2012 at 12:57 PM in reply to Lorelei
        "Hundreds of thousands of borrowers are expected to receive restitution, averaging $1500 to $2000, if they lost homes to foreclosure" ... "Most of the writedowns are expected to occur on loans that the five banks own themselves"
        • reply
          by Lorelei on Feb 9, 2012 at 01:17 PM in reply to Annie Mosity
          I understand the pain of foreclosure, but also am aware that hundreds of thousands bought "mansions" when they should have known better...Come on now, since when can one family with an average salary afford some of the oplaces we now have seen on the market for more than 2/3 years because they are too big/expensive? Why did it take a foreclosure for most of these families to realize that a 2500 a month mortgage was just TOO MUCH for their budget?Let's keep it real! The banks are to blame, granted, but you don't sign a mortgage agreement under threat of death...so one must also share responsibilty.
      • reply
        by Annie Mosity on Feb 9, 2012 at 06:44 PM in reply to Lorelei
        Lend me $20,000. My income is low, I have 3 kids, my husband is disabled, and my credit rating is bad. I could use the money, so lend me $20,000. Lend me $20,000. Lend me $20,000. The banks had all the power. The banks could say no. The people couldn't overrule it. They played a small part in it, but it was a banking failure, not a failure of the people.
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