Oklahoma AG Files $18.6M Settlement with Mortgage Banks

The Oklahoma Attorney General’s Office has set a Sept. 13 deadline for residents to apply for compensation under the state’s $18.6 million settlement with five mortgage lenders, the Associated Press reported.

Oklahoma forged an agreement with five of the nation’s largest mortgage service providers — Bank of America, JPMorgan Chase, Citigroup, Wells Fargo and GMAC — over unfair and deceptive practices, such as dual-tracking and robo-signing, by the banks during the mortgage and foreclosure crisis, the AG’s office said.

Attorney General Scott Pruitt filed the settlement in Oklahoma County District Court. Oklahoma was the only state that didn’t join a national settlement with the lenders. Under the national settlement, top U.S. banks would pay up to $25 billion in exchange for resolving civil government lawsuits about misconduct in servicing home loans and pursuing faulty foreclosures.

Pruitt says he reached a separate agreement so that affected Oklahomans would likely receive more money — and faster. The AG contends that homeowners who were wronged during the foreclosure process with practices such as robo-signing or dual-track would have only received $1,500 to $2,000 through the federal settlement. The information released by his office did not specify an expected amount affected homeowners could expect from the Oklahoma settlement.

The AG’s office explained that robo-signing involved signatures being affixed to documents that legally required personal review by bank employees, which was not done.

Dual-tracking involved mortgage servicers advising homeowners to become delinquent on their home loans, claiming the delinquency would allow the banks to adjust their mortgages and save them from foreclosure. At the same time, the bank had the homeowner on a separate “track” to foreclosure, which typically was the end result even if the homeowner followed the bank’s instructions, according to the AG’s office

The money will be distributed by the public protection unit of the attorney general’s office. The unit currently is developing an index to determine how much money will be available for each homeowner. Officials say they’ve already received 65 applications for compensation, the AP reports.

No decision will be made on any funds leftover from the settlement until the first priority of helping wronged homeowners is achieved, according to the AG’s office.

Affected homeowners may apply online for compensation at www.oag.ok.gov . They can also call 405-521-2029.

Reuters reports that whistleblowers who were instrumental in revealing mortgage abuses by U.S. financial institutions, some of whom risked their careers to do so, are getting multi-million-dollar payouts.

Topics Homeowners Oklahoma