Fact Sheet: Mortgage Servicing Settlement

[ProSense]

Fact Sheet: Mortgage Servicing Settlement

Financial Relief for Homeowners: The servicers will be required to dedicate $20 billion to various forms of relief to borrowers.

• Principal reduction. At least $10 billion will be dedicated to reducing principal for borrowers who, as of the date of the settlement, owe more on their mortgages than their homes are worth and are either delinquent or at imminent risk of default.
  
  
• Refinancing. At least $3 billion will be dedicated to a refinancing program for borrowers who are current on their mortgages but who owe more on their mortgages than their homes are worth. All borrowers who meet basic eligibility criteria will be eligible for the refinancing, which will reduce interest rates for borrowers who are currently paying much higher rates or whose adjustable rate mortgages are due to soon rise to much higher rates.
  
  
• Other forms of relief. Servicers will be required to dedicate up to $7 billion to other forms of relief, including forbearance of principal for unemployed borrowers, anti-blight programs, short sales and transitional assistance, benefits for service members who are forced to sell their homes at a loss as a result of a Permanent Change in Station, and other programs.

To encourage servicers to provide relief quickly, there are incentives for relief provided within the first 12 months - and additional cash payments required for any servicer that fails to meet its obligation within three years.

Servicers will receive only partial credit for every dollar spent on some of the required activities, so the settlement will provide direct benefits to borrowers in excess of $20 billion.

Payments to State and Federal Governments: In addition to the $20 billion of financial relief for homeowners, the servicers will make $5 billion in cash payments to the states and federal government. Of the $5 billion:

- more -

http://portal.hud.gov/hudportal/HUD?src=/mortgageservicingsettlement/fact-sheet

[girl gone mad]

1. A terrible deal for the people.

Great time to be a bankster, though. Same as it ever was.

[russspeakeasy]

2. I give you $1,000 to keep you solvent (tarp), you give me $1.

We're even, right ?

[MrCoffee]

3. What's one more massive scam among friends, right?

[MFrohike]

4. Sweet

$10 billion in principal reduction for first mortgages, while nothing for junior liens. Now who could possibly own those junior liens that remain at full value on the books?

[marmar]

5. There's not enough lipstick in Sephora for this pig of a settlement.

nt

[msongs]

6. there u go again criticising the obama PR department lol nt