Five of the Nation's Largest Banks Get Their Hands Slapped! Minnesota Benefits!

The Washington Times is reporting what could be some good news finally in the foreclosure area.

"State and federal officials on Thursday announced a settlement of $26 billion with five of the nation’s banks over flawed and fraudulent foreclosure practices that affected several million homeowners and became commonplace after the housing boom turned to bust in recent years. It is the largest government-industry settlement in more than a decade."

What does this mean for Minnesotans? You can go to the Attorney General's website and get all the information you need.

There will be up to $77 million in direct payments to Minnesota borrowers as follows:

• Borrowers who were foreclosed on between January 1, 2008 and December 31, 2011 will be eligible for cash refunds estimated to be around $2,000 if they lost their home as a result of financial hardship and while either trying to save it through a modification or whether there were errors in the foreclosure process. The federal government has estimated Minnesota’s portion of this part of the settlement to be valued at about $33.9 million. The exact payment to Minnesota borrowers will depend upon the number of eligible borrowers who file claims.
• Borrowers of the five banks may file a claim for monetary relief if they were harmed by the banks’ practices. Minnesota’s portion of this part of the settlement is valued at about $43.4 million.

There is also some refinancing benefits to this settlement.

It aims to help troubled borrowers by requiring the banks to reduce the amount borrowers owe on their mortgages, lowering their interest rates and paying restitution to homeowners who suffered mortgage-related abuses. It will force lenders to revamp how they interact with struggling mortgage holders and bar them from trying to foreclose on borrowers while simultaneously negotiating mortgage modifications.

Please check the Attorney General's website.

More from the Washington Times article:

"Officials said the settlement — details of which can be seen on www.NationalMortgageSettlement.com — probably would be filed in a federal court within a matter of weeks and would require the consent of a judge. Once it is approved, banks would begin to deposit money into a trust account, and those funds would be distributed to qualified homeowners by the government. In all, 49 states have signed onto the agreement, with Oklahoma the lone holdout, federal officials said."

So be sure to check out the website above as well for more information.

Meanwhile, Lori Swanson, Attorney General for Minnesota, stated in an interview tonight that homeowners should be contacting their lenders NOW.

I sincerely hope that this will be able to keep more St. Michael and Albertville Minnesota homeowners in their homes!