Correcting Foreclosure Practices
Updated June 17, 2015
OCC to Escheat Funds from the Foreclosure Review
On June 17, 2015, the Office of the Comptroller of the Currency (OCC) announced the decision to escheat any remaining uncashed payments made pursuant to the Independent Foreclosure Review (IFR) Payment Agreement at the end of 2015 so eligible borrowers and their heirs may claim the funds through their states’ escheatment processes. To date, the IFR Payment Agreement has distributed more than $2.7 billion to more than 3.2 million eligible borrowers from OCC-supervised institutions. This amount represents more than 90 percent of the total amount available for distribution. Despite that high cash rate compared to many other payment distributions, the OCC anticipates that approximately $280 million from OCC-supervised institutions will remain unclaimed at the end of the year after considerable efforts to locate eligible borrowers have been exhausted. The decision to escheat all funds available from uncashed checks provides the remaining eligible borrowers and their heirs the additional opportunity to claim the funds through their states’ escheatment claims processes. The OCC’s decision only affects funds attributable to the orders issued to institutions it regulates. The OCC expects funds to be escheated at the end of 2015. Each state has different timelines, but it may be six months or more after the funds are escheated to the states before the respective state is able to provide payments under their unclaimed property processes. There is no time limit within which eligible individuals must request unclaimed funds under the states’ unclaimed funds processes.
OCC Terminates Consent Orders Against Three OCC-Regulated Mortgage Services
On June 17, 2015, the OCC terminated orders against Bank of America, N.A.; Citibank, N.A.; and PNC Bank, N.A., because it determined that these institutions have complied with the orders issued in April 2011 and amendments issued in February 2013.
Foreclosure-related consent orders against Aurora Bank, FSB, and MetLife Bank, N.A., were terminated previously by operation of law after these institutions ceased to operate as regulated, insured depository institutions. Separately, OneWest Bank completed the IFR and remediation to borrowers as required under its original order issued in April 2011 and did not enter into a payment agreement with federal regulators. Final determination of OneWest Bank’s compliance with the corrective actions required in its April 2011 order is being considered in conjunction with its application to merge with CIT Bank, and separately from other banks that entered into IFR payment agreements in 2013.
OCC Imposes Restrictions on Six OCC-Regulated Mortgage Servicers
On June 17, 2015, the OCC announced certain business restrictions related to mortgage servicing activities of EverBank; HSBC Bank USA, N.A.; JPMorgan Chase Bank, N.A.; Santander Bank, National Association; U.S. Bank National Association; and Wells Fargo Bank, N.A. The OCC determined that these banks have not met all of the requirements of existing consent orders. The restrictions include limitations on:
These restrictions vary based on the particular circumstance of each bank. The purpose of the business restrictions is to focus the banks’ resources on the corrective requirements of the consent orders that they have not yet completed. The restrictions will not impede mortgage financing and origination and will not restrict consumer access to mortgages.
Information about IFR Payments
The deadline for recipients to request that the payment administrator reissue a check that has been lost or destroyed is June 19, 2015.
Questions about IFR payments should be directed to the payment administrator, Rust Consulting, at 1-888-952-9105, Monday through Friday, 9 a.m. - 8 p.m. ET or Saturday, 11 a.m. - 4 p.m. ET.
Notice to Financial Institutions
Institutions processing checks are reminded that checks require positive identification. Financial institutions should follow the instructions on the back of the check to validate authenticity.
Questions about IFR paymentsto eligible EverBank borrowers should be directed to Epiq Systems at 877-819-9754.
Remediation began on March 3, 2014, for eligible borrowers whose mortgages were serviced by Financial Freedom (OneWest) and IndyMac Mortgage Services (OneWest) and were found by the IFR to have suffered errors resulting in financial harm. Borrowers who have questions about their remediation letter from Financial Freedom (OneWest) and IndyMac Mortgage Services may call 1-800-500-6097, Monday through Friday, 8 a.m.–8 p.m. CST.
Foreclosure Prevention Assistance
Regulators encourage borrowers needing foreclosure prevention assistance to work directly with their servicer or contact the Homeowner's HOPE Hotline at 888-995-HOPE (4673) (or at Making Home Affordable) to be put in touch with a U.S. Department of Housing and Urban Development approved nonprofit organization that can provide free assistance.
Additional Background Information
Links to Related Reports
Links to Enforcement Action Amendments for Servicers Entering the IFR Payment Agreement (Issued February 2013):
The OCC released engagement letters that describe how the independent consultants, retained by the servicers, will conduct their reviews and claims processes in accordance with the OCC's consent orders. See the engagement letters.