Federal banking agencies have extended a key deadline in a major foreclosure relief program as they work to make more people aware of it.
Borrowers who think they were the victim of foreclosure abuses or mistakes involving their primary residence in 2009 or 2010 now have until Dec. 31 to request a free and impartial foreclosure review to determine whether they're eligible for some type of remedy. The previous deadline was Sept. 30.
The foreclosure reviews are the result of a major enforcement action that the Office of the Comptroller of the Currency (OCC) and the Federal Reserve took against 14 large mortgage providers in 2011 for unsafe, unsound or deficient foreclosure practices. The companies were required to identify borrowers who may have been harmed. Injured borrowers may get some type of remedy such as the suspension or turn-around of a foreclosure, or a lump-sum payment of up to $125,000 plus lost equity.
More than 4 million people have been identified as having their loans serviced by one of the 14 companies and being in some stage of foreclosure during 2009 and 2010, but it's not known how many are eligible for compensation. The regulators have drawn criticism for not doing enough to reach everyone who deserves a review, but the OCC has said it's made extraordinary efforts.
"We're going to be increasing the outreach effort to minority communities and those hit hardest by foreclosures," OCC spokesman Bryan Hubbard said in an interview.
The program is for borrowers whose mortgages were serviced by one of the 14 companies, which includes such servicers as Wells Fargo and U.S. Bank.
Jennifer Bjorhus 612-673-4683