Atty-Gen Lisa Madigan Urges Homeowners to Check if they Qualify for Mortgage Relief

Chicago — Attorney General Lisa Madigan today urged distressed borrowers to call on her office to help determine if they are eligible for relief under the $25 billion national foreclosure settlement with the nation’s five largest bank mortgage servicers, which was filed this morning in federal court.

“I can’t stress enough how important it is to make the call for help,” Madigan said. “Whether you are eligible under this settlement or another assistance program, we want to connect you with the free, legitimate resources available for distressed borrowers.”

Today’s filing is the next critical step in formalizing the settlements reached with Bank of America, JPMorgan Chase, Wells Fargo, Citibank and Ally Bank, formerly GMAC, over allegations of widespread “robo-signing” of foreclosure documents and other fraudulent practices while servicing loans of struggling homeowners. Last month, Madigan joined U.S. Attorney General Eric Holder, U.S. Housing and Urban Development Secretary Shaun Donovan and her counterparts in Washington, D.C., to announce the agreement had been reached with the five servicers following months of joint investigations and negotiations.

The national settlement is the largest settlement ever obtained through joint action of state attorneys general and the federal government. It is estimated to provide more than $1 billion in relief for Illinois borrowers who fit into one of three categories: 1) Borrowers who have lost their homes, 2) Homeowners who are still in their homes but at imminent risk of defaulting on their mortgages or behind on their mortgage payments and 3) Borrowers who are current on payments but underwater.

Attorney General Madigan urged consumers seeking more information to contact her Homeowner’s Helpline, (866) 544-7151, or visit her website, www.illinoisattorneygeneral.gov/consumers/bankforeclosuresettlement.html. Borrowers can also visit www.NationalForeclosureSettlement.com.

Madigan said borrowers also should contact their mortgage servicer to obtain more information about specific loan modification programs and whether they qualify under terms of this settlement.

Participating Mortgage Servicer Consumer Numbers:

Bank of America: 1-877-488-7814
Citigroup: 1-866-272-4749
Chase: 1-866-372-6901
Ally/GMAC: 1-800-766-4622
Wells Fargo: 1-800-288-3212

In addition, Madigan said there is help available from the Independent Foreclosure Review through the Office of the Comptroller of the Currency and the U.S. Department of Treasury. Borrowers whose primary residence was involved in a foreclosure process between Jan. 1, 2009 and Dec. 31, 2010, may qualify for a free Independent Foreclosure Review to determine if they are eligible for compensation because of errors or other problems during their home foreclosure process. All Requests for Review must be submitted online or postmarked no later than July 31, 2012. For more information, visit http://www.independentforeclosurereview.com or call 1-888-952-9105.

Already, more than 3,000 borrowers have contacted Madigan’s office to determine whether they may be eligible for help under the settlement. Madigan noted that under the agreement, an independent monitor has been established to oversee the terms of the settlement and importantly, to ensure that the banks comply.

Next Steps

Madigan noted that the settlement does not grant the banks any immunity from criminal offenses nor does it prevent homeowners or investors from pursuing individual, institutional or class action civil cases against the five banks. The state attorneys general and federal agencies will continue to investigate and pursue other aspects of the mortgage crisis, including securities cases. In Illinois, Attorney General Madigan already has filed lawsuits against Wells Fargo, Standard & Poor’s and Nationwide Title Cleaning Inc., as part of her aggressive efforts to hold financial institutions accountable for their part in the housing crisis and the country’s economic collapse.

“This settlement does not mark either the beginning or the end of our work to hold banks and other institutions accountable for the destruction they’ve caused our families, communities and country, but it is a warning to financial institutions that there are consequences for engaging in practices that jeopardize the stability of our communities and our economy,” Madigan said.



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Illinois Department of Human Services and US Department of Housing and Urban Development Officially Launch Program to Help Stabilize Neighborhoods

From the Illinois Department of Human Services

CHICAGO – As home foreclosures across the nation and state reach record levels and abandoned and foreclosed homes threaten the stability and economic health of Illinois neighborhoods, Illinois Department of Human Services’ (IDHS) Secretary, Dr. Carol L. Adams, today announced the signing of the agreement for the Neighborhood Stabilization Program with the US Department of Housing and Urban Development (HUD). The State of Illinois Neighborhood Stabilization Program (NSP) will provide $53 million in emergency assistance to local governments, developers, and non-profit organizations to acquire, redevelop, or resell foreclosed properties that might otherwise become sources of abandonment and blight within their communities.

Illinois is the only grantee to specifically address the needs of the State’s priority populations by setting an aggressive goal of using up to 40% of it’s allocated funding for developments that provide affordable and/or accessible homes for very low-income households and persons with disabilities. As the lead agency, IDHS will work in partnership with the Illinois Housing Development Authority (IHDA), the Illinois Department of Commerce and Economic Opportunity (DCEO) and affordable housing advocates to help redevelop communities and address the housing needs of the State’s most vulnerable residents. IDHS’s main goals are to allocate resources to communities that were the hardest hit by foreclosure and to provide affordable rental housing and homeownership opportunities for low-income individuals and persons with disabilities.

“The devastation of foreclosures affects not only the homeowner, but the entire neighborhood. The impact of foreclosures can devastate a community and has the potential to cause its rapid deterioration. IDHS is happy to partner with other state agencies to begin to take the necessary steps to address the unprecedented crisis facing this country. These neighborhoods need our help and we are making sure that they have the resources they need to get out of this crisis,” said IDHS Secretary, Carol L. Adams, Ph.D.

“The Neighborhood Stabilization Program is an important federal resource essential in the effort to restore communities and create opportunities for affordable housing. The Illinois Housing Development Authority will bring our expertise in housing development and mortgage finance to partner with IDHS to implement the Illinois Neighborhood Stabilization Program, and begin the task of eliminating blight created by the foreclosed and abandoned properties statewide,” said IHDA Executive Director DeShana L. Forney.

Illinois’ efforts under the Neighborhood Stabilization Program will help reinvigorate distressed neighborhoods by providing funds to address foreclosed and abandoned properties that can be rehabilitated for resale, converted into affordable housing and related uses. Grantees can also create financing products to help low- to-moderate-income homebuyers purchase an abandoned and foreclosed home, namely persons with incomes of 120 percent of the area median income as defined by HUD.

The federal Housing and Economic Recovery Act of 2008 was signed into law on July 30, 2008. Among its incentives is the Neighborhood Stabilization Program, a one-time funding program to provide emergency assistance to state and local grantees to address abandoned and foreclosed homes. The legislation authorizes up to $3.9 billion nationally for the acquisition, rehabilitation, and demolition of foreclosed and abandoned properties and will help communities to eliminate blight, control crime and stabilize property values.

“Through the Neighborhood Stabilization Program, HUD will try to support, not just localized efforts, but regional and other innovative efforts, like we are seeing in Chicago and other places that are bringing municipalities together to attack the problem of foreclosed homes and their devastating impact on communities,” said HUD deputy regional director Beverly Bishop.

The State is currently soliciting proposals for projects for the NSP program. Interested persons can access the complete Request for Proposals package from the State of Illinois Procurement Bulletin at http://www.purchase.state.il.us. Eligible applicants include Community Action Agencies, For Profit Developers and Organizations, Non-profit developers, Units of Local Government including Municipalities, Counties and Housing Authorities. The application deadline is May 4th, 2009 at 5:00 pm. For more eligibility information, potential applicants can visit http://www.dhs.state.il.us/nsp.