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Settlement Checks Over 2009-10 Foreclosures Arrive
FAIRBANK, Iowa - Five weeks ago, a postcard arrived at Harold Clayton's house. Not unusual for any homeowner.
"I thought it was fake," he said of the card, informing him of the pending settlement checks of the $3.6 billion Independent Foreclosure Review. The federal government reached a settle with 13 large mortgage providers for foreclosure actions during 2009 and 2010.
Earlier this week, Clayton was one of the four million Americans who received a $300 check.
"This is to give Citi Mortgage a feeling of they don't have to feel guilty," said Clayton, 64, as he sat at his kitchen table in rural Fairbank, with years of his financial documents in order.
"I made every payment," Clayton said. "I never missed a payment. Not a one."
Until 2010 when, Clayton says, Citi would constantly send solicitations to his home to remodify his loan. Clayton said that he was paying more than 8% on his mortgage in interest and wanted to lower the interest and the payments.
Clayton said workers with Citi told him to not make his mortgage payments as his loan request was in processing. In October 2010, the remodification was denied.
Weeks later, a far more drastic step.
"I was foreclosed on December 23," he said. "When I got foreclosed on, I was going crazy."
In his desperate attempt to stay in his house, Clayton took help from family and was about to scrape together enough money - about $14,000, he said - and became current on his mortgage. Yet the previous months had make my credit rating plunge.
In early 2011, his history with Citi ended as he was informed the company sold his mortgage was sold to another company, PennyMac, which is now run by former leaders with Countrywide, one of the 13 companies in the settlement.
On Thursday, the Office of the Comptroller of the Currency told KCRG-TV 9 that, to date, 1,032,580 people had cashed settlement checks totaling more than $986 million.
On Friday, April 26, another 927,000 settlement checks will be mailed out for a total of $794 million. The OCC said, by week's end, more than $3.2 billion of the settlement money has been issued.
Still, for Clayton, the $300 he received barely scratches the surface of what he has endured. He said he simply wants to find an FHA mortgage at the more competitive rates but feels trapped now.
"I thought, this is a joke," Clayton said of the check. "This is to prove that they made a mistake and that's all they're going to give me."