Some Mississippians who've suffered foreclosure of their home, or who have lost money due to a balloon mortgage, will see some relief. A big settlement has been reached nationwide with Bank of America, JP Morgan Chase, Wells Fargo, Citibank, and Ally.
About $13.1 million will be divided among homeowners, in loan modifications and other direct relief. $8.4 million will be divided among foreclosure victims. $11.2 million will go into a big refinancing program. The state's general fund will get $14.2 million.
The lawsuit was brought on due to what's called robo-signing, where foreclosure documents are signed without anyone making sure they're accurate. But according to Attorney General Jim Hood, none of that happened in Mississippi.
"We have a judicial foreclosure system, so our laws protected a lot of our consumers," General Hood says. "It's great for Mississippi. It's a gravy settlement for Mississippi because, there again, the robo-signing, we didn't have any."
General Hood adds, "There were losses in Mississippi. People that invested in Wall Street, there are homeowners that were hurt as a result of this packaging, escalation (of interest rates)."
General Hood did not decide how the relief money is divided; that was done by those who forged the settlement agreement.
Families with mortgages controlled by Fannie Mae or Freddie Mac are not eligible for the relief funds.
While a monitor will be put in place to keep the banks in line, there will be no way to ferret out who lost money due to their own financial mistakes.
"It almost reminds me of another stimulus," says Christine Whitton, Real Estate Agent with Godfrey & Ivy Realty.
Whitton says it's good that justice has come through. But there's a flip side.
"There are a lot of people who have been responsible, lived within their means, haven't gone on vacation, made sure their mortgages have been made. Yet what do we get for it?" she asks.
Whitton says families who buy within their means will continue to get squeezed, because the loan market has become so tight as a result of this scandal, mortgage loans are hard to come by.
If you are entitled to relief money as a result of the settlement, one of the banks will call you. General Hood advises you to answer the phone if you get a call from one of those banks.
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