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Servicing

National Mortgage Settlement progress report: Big banks closer to finalizing consumer relief

Some of the giant servicers are well past the halfway point

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The mega lenders subjected to the National Mortgage Settlement are closer to meeting the consumer-relief mandates rolled out as part of a nationwide initiative to compensate borrowers for past servicing issues.

The relief comes in two forms – refinancing initiatives and consumer relief – with the servicers showing different levels of progress in both categories.

"My colleagues and I conducted an extensive and thorough testing process that provides me with a sound basis to determine the banks’ credited relief as of Dec. 31, 2012. The banks refinancing progress ranges from nearly halfway to beyond fully complete," said Joseph Smith, the monitor overseeing the settlement.

The National Monitor released a report covering Bank of America (BAC), Chase (JPM), Citi (C) and Wells Fargo (WFC), while former Ally Financial subsdiary, ResCap, was excluded since the firm's findings were included in a prior report.

The data provided through Dec. 31, 2012, shows Bank of America is almost finished in meeting all of its consumer relief goals. In fact, the lender's work in this arena is now 97% complete. Meanwhile, Chase has only completed 76% of its consumer relief goals, while Citi and Wells Fargo lag behind with their consumer relief goals now estimated to be 46% and 55% complete, respectively.

National Settlement Monitor Joseph Smith filed the data with the U.S. District Court for the District of Columbia on Wednesday, outlining each bank’s progress.

Bank of America alone has been credited for providing $7.4 billion in total consumer relief on 287,906 loans through the survey period ending last December. The firm is not far off from meeting its total consumer relief obligation of $7.626 billion.

But on the refi-side, BofA has only met 41% of its total aid goal. The firm expects to provide $948 million in refi-relief to consumers, but to date, it has only provided $392.2 million.

Chase established a $7.2 billion consumer relief goal, and is now credited for providing $2.784 billion in this sector. On the refi side, Chase has already met its goal, credited for providing $606 million in total refinancing aid, well beyond its initial obligation of $537 million.

Citi is nearly halfway to its goal of providing $655 million in consumer relief – which is far short of its total goal of providing $1.4 billion in support. When it comes to refinancings, Citi is doing much better, already passing its goal of offering $378 billion in refinance aid, with the firm now credited for offering $519 million in refi relief.

Wells Fargo still has a ways to go in meeting its consumer relief obligation of $3.4 billion, but is halfway there with $1.89 billion in aid already credited to the bank. Wells Fargo also beat its $903 million total refinancing obligation, with the monitor crediting the firm for providing $1.1 billion in refi aid so far.

Click here to read a fact sheet from the Mortgage Settlement Monitor.

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