If you purchased a home through GMAC, now known as Ally Financial, Bank of America, JPMorgan Chase, or Citibank, you may want to take note. A recent settlement of $25 billion is proposed to aid homeowners who may have been subject to “robo-signing,” in loan and foreclosure practices. If you currently have a loan or experienced a foreclosure with one of these lenders, you may be eligible to receive assistance.
So what is robo-signing? The term “robo signing” refers to the practice of mortgage providers signing or stamping documents without verifying information, and has been widely held to be at least a partial cause of the recent mortgage crisis.
The new agreement, authorized in 49 states (notOklahoma), strengthens the review process on loan modifications and foreclosures by requiring application reviews prior to beginning the foreclosure process. Excessive fees, insurance costs, and appraisal rates also received limits, and the agreement also provided avenues for principal reduction for struggling homeowners. This agreement does not apply to any FHA, Freddie Mac or Fannie Mae loans or foreclosures.
If you have a mortgage on your home that is less than 417,000 dollars, and has shown a 20% or more reduction on the properties value, you may meet the requirements necessary to reap the benefits. Also, homeowners with an interest rate above 5.25% may be able to refinance at a lower rate, and those who are currently facing unemployment may be able to get aid as well. The process itself is determined on an individual basis, so contact your lender to see if you may qualify.