Report: 92,000 Floridians Receive $9.1B in Mortgage Relief Deal

The latest report from the National Mortgage Settlement Monitor indicates that some 92,000 distressed homeowners in Florida have been granted some form of housing relief as part of a $9.12 billion deal brokered by Florida Attorney General Pam Bondi.
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Initially, Bondi and her team were part of the crew that negotiated $4 billion for Florida in a $25 billion national deal with banks that had admitted a significant role in the perpetuation of the housing crisis, which left many borrowers underwater – or worse. Subsequently, Bondi worked out a deal between three of the biggest banks involved – JPMorgan Chase, Wells Fargo and Bank of America – that more than doubled what Florida homeowners would receive.

Florida was one of three states to work out a separate side deal. Bondi would later say this agreement was critical because Florida was the hardest-hit by the housing crisis – something our Miami foreclosure attorneys know all too well.

Still, whether this relief will actually have a long-lasting impact is questionable.

A major part of the agreement included an upgrade of mortgage servicing standards, in an effort to avoid a similar downward spiral like we saw in 2008. Bondi’s office has said that several of the larger firms “continue to show improvement” in this regard. However, that tells us that the standards still aren’t being met – a point the monitor makes against new servicer Green Tree, about which it was noted, “Much work needs to be done to address the compliance issues.”

Meanwhile, even the larger servicers who supposedly “showed improvement” continued to violate key rules as laid forth in the settlement. For example, Bank of America failed three of the more than 30 corrective action plan stipulations. One of those measures involved accuracy of amounts due from borrowers in affidavits filed in support of motions to collect from borrowers who were in the midst of a bankruptcy. Another involved failure to provide the borrower with accurate information in their pre-foreclosure letter. Finally, the bank failed in the requirement to notify borrowers in the midst of a loan modification application of any missing documentation within five days (allowing them enough time to correct the issue).

In the meantime, homeowners have continued to suffer as a result of unfair practices.

It’s also worth noting that while $9 billion sounds like a lot of money, it’s a minute fraction of what these firms generate in a given quarter. Reporting on the issue also glosses over the fact that these banks didn’t actually hand over $9 billion. In fact, 49 percent of that “money” was in the form of write-downs on first and second mortgage liens. For many people, a write-down of a second-mortgage lien isn’t going to help them save their home.

Fifteen percent of those aided with approximately $1.4 billion received relief in the form of refinancing.

Finally, more than 35 percent, or $3.2 billion, worth of “relief” came in the form of short sales and deficiency waivers. Homeowners often still walked away with dark blemishes on their credit, and in some cases, still losing their homes and forced to file for bankruptcy.

If you’re battling foreclosure in Miami or the surrounding areas contact Jacobs Keeley for a confidential appointment to discuss your rights. Call (305) 358-7991. Also, don’t miss Miami Foreclosure Attorney Bruce Jacobs on 880AM/the Biz, every Wednesday from 5 p.m. to 6 p.m. on “Debt Warriors with Bruce Jacobs,” discussing foreclosure topics that matter to YOU.

Additional Resources:
National Mortgage Settlement Monitor Reports that Nearly 92,000 Floridians Have Received $9.12 Billion in Credited Relief, May 20, 2014, News Release, Florida Attorney General Pam Bondi
More Blog Entries:
Non-Disclosure Agreements for Mortgage Loan Modifications? May 31, 2014, Miami Foreclosure Defense Lawyer Blog