Mortgage settlement relief to Wisconsin residents tops $143M

MADISON (WITI) -- Attorney General J.B. Van Hollen announced Wednesday, February 27th that $143,628,842 in loan-related relief has reportedly been provided to 3,065 Wisconsin borrowers under the National Mortgage Settlement.

This represents an average savings of $46,861 for each borrower receiving benefits.  In addition, 184 Wisconsin borrowers have been offered $13 million worth of savings in approved mortgage modifications.

These benefits apply to borrowers who did not lose their homes to foreclosure but to consumers struggling to make payments, or to consumers who owed more than their home was worth.  A detailed report released by the Settlement Monitor can be found here.

This financial relief has resulted from the National Mortgage Settlement between 49 states’ Attorneys General and the five largest mortgage servicers in the country, which had an original estimated value of $25 billion and minimum requirement that the settling servicers provide at least $20 billion in loan-related relief to consumers struggling to make payments, or to consumers who owed more than their home was worth.

As of December 31, 2012, the settling servicers have reported offering $45 billion in loan-related relief to such consumers, which far exceeds the initial projected figures.  Loan-related relief includes refinancing, principal reduction, mortgage modification offers, second-lien forgiveness, short sales and enhanced transition assistance, among other options to homeowners.

In Wisconsin, this loan-related relief was initially projected to be $91.3 million, but based on preliminary reports, the banks are on target to exceed $150 million.

In addition, the settlement separately earmarked approximately $1.5 billion for payments to two million borrowers nationwide who lost their homes to foreclosure from 2008-2011.  In Wisconsin, beginning in mid-2013, approximately $17.2 million will be available for cash payments to more than 22,000 Wisconsin borrowers who have lost their homes to foreclosure.

Under the two combined settlement pools, direct relief to Wisconsin consumers under the National Mortgage Settlement is projected to top $167 million, exceeding the initial estimate of $109 million.

Attorney General Van Hollen also warns consumers of settlement-related scams.  Relief under the settlement is free, so be especially wary if you are asked for a fee for assistance in obtaining benefits under the settlement, including loan modification.

If you suspect a scam, please contact the DOJ Office of Consumer Protection (1-800-998-0700), or the Department of Agriculture, Trade and Consumer Protection (“DATCP” 1-800-422-7128). 

Additional information about the settlement is available at: http://www.nationalmortgagesettlement.com.