Compensation for improper foreclosure
In September 2015, the Department of Justice announced a huge win for servicemembers and their families: a total of 2,413 servicemembers and their co-borrowers were eligible to receive over $311 million due to their mortgage providers improperly foreclosing on their homes. The banks that violated federal law and owe money to servicemembers are JP Morgan Chase, Wells Fargo, Citi, GMAC Mortgage, and Bank of America (or Countrywide).
The available compensation results from a number of settlements between the Department of Justice and the various banks stemming from improper home foreclosures that took place between Jan. 1, 2006 and Apr. 4, 2012. Per the Servicemembers Civil Relief Act (SCRA), banks were supposed to obtain a court order from a judge before they could foreclose on a home that was mortgaged by a servicemember, in addition to filing documents with the court stating that the borrower was in military service.
Under the settlement, each identified eligible servicemember will receive $125,000 plus any lost equity in the property and interest.
If you have questions about a past mortgage and you think you qualify to receive part of this settlement, you should contact the following institutions based on which provider you borrowed from:
- Bank of America borrowers should call Rust Consulting Inc., the settlement administrator, toll-free at 1-855-793-1370 or write to BAC Home Loans Servicing Settlement Administrator, c/o Rust Consulting Inc., P.O. Box 1948, Faribault, MN 55021-6091.
- Citi borrowers should call Citi toll-free at 1-888-326-1166.
- GMAC Mortgage borrowers should call Rust Consulting Inc., the settlement administrator, toll-free at 1-866-708-0915 or write to P.O. Box 3061, Faribault, Minnesota 55021-2661.
- JPMorgan Chase borrowers should call Chase toll-free at 1-877-469-0110 or write to P.O. Box 183224, OH-7160/DOJ, Columbus, Ohio 43219-6009.
- Wells Fargo borrowers should call the Wells Fargo Home Mortgage Military Customer Service Center toll free at 1-877-839-2359.
Servicemembers can report complaints with their mortgage providers to the Consumer Financial Protection Bureau (CFPB) Office of Servicemember Affairs. The CFPB is able to take action against individuals, businesses, and financial institutions and the agency has recovered millions of dollars in relief for servicemembers that targeted them with scams or illegal practices in just the last few years.
The CFPB Office of Servicemember Affairs serves active duty servicemembers, retirees, and veterans by providing training, financial counseling, and acting on complaints filed by servicemembers and their families. For additional information on the CFPB and the various ways their office can help you, visit http://www.consumerfinance.gov/servicemembers/.
The SCRA provides a number of additional protections to servicemembers and their families, to include provisions allowing servicemembers to cancel cell phone contracts and residential leases in anticipation of upcoming deployments or a Permanent Change of Station, reduce pre-service debt to 6% (including student loans), and request delays in civilian court appearances due to military requirements. For additional information on the SCRA and how it can help you, visit http://www.federalreserve.gov/boarddocs/supmanual/cch/200911/scra.pdf.
If you have questions or concerns about any consumer law issues, call your local Region Legal Service Office (RLSO) for legal assistance. In Guam, the RLSO Legal Assistance Office is located on Naval Base Guam in Barracks 1A off Chapel Road. Their office number is 671-333-2061 and is open from 0900-1530 every day. The RLSO Legal Assistance Office also offers notary services, powers of attorney, and can help you with other legal areas to include estate planning (wills), family law (divorce/child custody), and landlord/tenant issues.