NC consumers to share in $470 million from HSBC, AG Cooper says

NC consumers to share in $470 million from HSBC, AG Cooper says

By / State News / الثلاثاء, 09 شباط/فبراير 2016 05:00

Funds part of national settlement to address abusive mortgage practices

RALEIGH, N.C. : February 5th, 2016 - A $470 million national settlement with HSBC will bring significant consumer relief to North Carolina homeowners, including loan modifications, an estimated $1.8 million in cash payments, and stronger rules to prevent future mortgage and foreclosure abuses, Attorney General Roy Cooper said Friday.
The joint state-federal settlement with mortgage lender and servicer HSBC includes 48 additional states, the District of Columbia, and the U.S. Department of Justice, the U.S. Department of Housing and Urban Development, and the Consumer Financial Protection Bureau.
Under the agreement, HSBC will provide direct relief payments to victims of unfair foreclosure, as well as loan modifications and other relief for mortgage borrowers. HSBC must also meet stricter mortgage servicing standards that aim to prevent future problems for homeowners.
“North Carolinians who take out mortgages deserve to be treated fairly by their lenders,” Cooper said. “This agreement brings direct relief for deserving homeowners and better protections for future borrowers.”
Relief for Consumers
HSBC is required by the agreement to provide borrowers around the nation $370 million in loan modifications or other relief, including short sales, refinancing at reduced rates, deficiency waivers, forbearances for unemployed borrowers, and deeds in lieu of foreclosure.
In addition, an estimated 2,194 North Carolinians who lost their homes to foreclosure may be eligible for direct cash payments totaling approximately $1,842,960, which will come from a national $59.3 million fund created under the settlement.
Consumers may be eligible for cash payments if they:
• Had a mortgage serviced by HSBC;
• Experienced servicing abuses; and
• Lost their home to foreclosure from January 1, 2008 through December 31, 2012.
North Carolinians who are eligible for cash payments from the settlement will be contacted by a settlement administrator about how to qualify for payments. Payment amounts will vary depending on how many borrowers file claims.
HSBC consumers who have questions can contact their lenders at the following numbers:
• For loans serviced by HSBC Bank USA, contact 1-866-435-7085
• For loans serviced by HSBC Mortgage Services, Household Finance, or Beneficial, contact 1-800-333-7023
Tougher mortgage servicing standards
Under the settlement, HSBC is also required to change how it services mortgage loans, handles foreclosures, and ensures the accuracy of information provided in federal bankruptcy court. These changes are designed to prevent past foreclosure abuses, like robo-signing, improper documentation and lost paperwork, from happening again.
 The reforms include:
• Requiring HSBC to evaluate homeowners for other options before beginning foreclosure proceedings;
• Restricting foreclosure while the homeowner is being considered for a loan modification;
• New procedures and timelines for reviewing loan modification applications;
• Giving homeowners the right to appeal denials;
• Requiring a single point of contact for borrowers seeking information about their loans; and
• Maintaining adequate staff to handle calls from borrowers.
More about the settlement
The agreement with HSBC will be filed as a consent judgment in the U.S. District Court for the District of Columbia. HSBC is a multinational banking and financial services company headquartered in London, United Kingdom.
Today’s settlement with HSBC closely resembles a 2012 national settlement Cooper negotiated with the five largest mortgage servicers at the time, Ally/GMAC, Bank of America, Citi, JPMorgan Chase and Wells Fargo. The National Mortgage Settlement resulted in new standards to prevent unnecessary and improper foreclosures and has provided more than $50 billion in relief to distressed homeowners to date. In North Carolina, the settlement provided $338 million for housing counselors, legal help, fraud detection and prosecution, and economic improvement, as well as an additional $33.57 million in payments to victims of foreclosure.
Cooper’s office has also helped negotiate similar settlements with Ocwen and SunTrust, totaling $2.65 billion nationally and $47.5 million in relief to North Carolina consumers.
Joseph A. Smith, Jr., Monitor of the National Mortgage Settlement and former North Carolina Commissioner of Banks will oversee the HSBC agreement’s implementation and compliance through the Office of Mortgage Settlement Oversight.
“Today’s agreement along with previous ones are holding banks accountable for past mortgage servicing and foreclosure abuses and preventing future ones,” Cooper said.
Source: North Carolina Department of Justice.

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