A client recently notified me that the Illinois Attorney General is sending
out notices to Illinois homeowners regarding the National Mortgage Settlement.
Included with the notice is a claim form. The claim form is rather simple
-- it includes the borrower's name, loan number, property address,
and a claimant ID. It also includes a current home address if different
than the property address.
There are three check boxes. Borrowers must check at least one to receive
a payment. The options are as follows:
1. I was unable to make payments on my loan due to a financial hardship.
2. I attempted to get a mortgage loan modification or other foreclosure
alternative, but the mortgage servicer company mishandled my application
or pursued foreclosure on my loan while the application was pending or
after it was approved.
3. The mortgage servicer company, foreclosure trustee, or their attorneys
made errors in the foreclosure process or leading up to the foreclosure process.
The accompanying documents don't really explain what happens next.
I would imagine that there will be some attempt to verify that there is
a factual basis behind the checked box's assertion, but there is no
apparent way to include a factual statement or supporting documentation.
Interestingly enough, the State of Illinois is estimating that eligible
borrowers will receive $840 as a minimum payment. According to the included
FAQ, this figure relies on every eligible borrower submitting a claim
form. Obviously, there is a realist in Lisa Madigan's office because
the letter also states that since the payment is based on 100% participation,
"the payment you receive will very likely be higher."
The most important piece of information to take away from this post is
that participating in the settlement does not prevent you from asserting
claims against your lender. If you accept the payment, you can still sue
your lender -- assuming that the statute of limitations on your claim
The bottom line is this: if you get the form, send it in -- something is
better than nothing in this situation.