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DOJ Announces Mortgage Abuse Settlement

  

About 7,500 people who lost their homes to foreclosure in California between 2008 and 2013 could be eligible for payments under a new joint multi-state and federal settlement announced today.

The settlement is with mortgage lender and financial services company HSBC.

The California Department of Justice, or DOJ, says the resolution holds HSBC accountable for abusive practices like lost paperwork, improper documentation and robo-signing.

HSBC will pay $370 million in loan modifications and other consumer relief. And the company will pay $100 million in cash, of which $60 million will be used to distribute payments to eligible borrowers. The state Department of Justice says about $6 million of that will go to California borrowers.

DOJ says more than 7,500 Californians were serviced by HSBC and lost their home to foreclosure from January 1, 2008 through December 31, 2012.

The department says eligible borrowers will be contacted about how to qualify for payments. 

 foreclosuremortgages

Steve Milne

Morning Edition Anchor & Reporter

Steve is the voice of Capital Public Radio News as anchor of Morning Edition and Insight. He covers stories on a wide range of topics including: business, education, real estate, agriculture and music. Steve also produced stories for CapRadio.org.   Read Full Bio