Gov’t Orders Mortgage Lenders to Reimburse Homeowners

The federal government on Wednesday announced formal enforcement actions requiring  17 mortgage lenders and servicers to reimburse homeowners who were incorrectly foreclosed upon.

The Federal Reserve, Office of Thrift Supervision and Office of the Comptroller of the Currency also ordered the mortgage lenders to hire auditors to see if they improperly foreclosed on homeowners in 2009 and 2010. A record 3 million homes received foreclosure notices in 2009 alone.

The lenders and service providers cited by the agencies are : Ally Financial Inc., Aurora Bank, Bank of America (BAC), Citibank, Citigroup Inc. (C), EverBank, HSBC (HBC), JPMorgan (JPM), MetLife Bank (MET), OneWest Bank, PNC (PNC), Sovereign Bank (STD), SunTrust Banks (STI), U.S. Bank (USB) and Wells Fargo (WFC).

The service providers mentioned are Lender Processing Services and MERSCORP. Collectively, these organizations represent 65% of the servicing industry, or nearly $6.8 trillion in mortgage balances.

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