(DES MOINES, IOWA) Approximately a thousand Iowans are eligible for cash after a settlement with a mortgage lender and servicer.
The Iowa Attorney General's Office says the Iowans were subject to improperly serviced mortgage loans from the beginning of 2009 to the end of 2012, and about half of the Iowans lost their homes due to foreclosure.
The payments stem from a 45-(M) million dollar settlement with New Jersey-based P-H-H Mortgage Corporation, $30.4 million will be set aside for payments.
Iowa Attorney General Tom Miller tells WHO Radio News the company was one of several during the nation's mortgage crisis, that could not handle the volume of customers, and foreclosed on properties without going through the proper procedures. He says it was part of an industry that had gone "off the rails."
“This settlement holds PHH accountable for harms to homeowners in Iowa and across the country because of the company’s previous improper loan servicing practices,” Attorney General Tom Miller said. “We continue to review this type of conduct because of its profound impact,” Miller added. “This agreement requires PHH to adopt servicing standards to help prevent improper mortgage servicing, and to provide financial relief to aggrieved homeowners.”
The settlement means borrowers subjected to PHH foreclosures during the eligible period will qualify for a minimum $840 payment, and borrowers who faced foreclosures that PHH initiated during the eligible period, but did not lose their home, will receive at least $285.
Approximately 739 Iowa borrowers are eligible for a payment, including 363 who lost their property and 376 borrowers whose foreclosures had not been finalized. eligible recipients will be contacted later this year.