Banks Pay Back Troops After Foreclosures

Banks Issue $123 Million to 952 Troops for Illegal Foreclosures 
Military.com
Michael Hoffman
February 10, 2015

"These unlawful judicial foreclosures forced hundreds of service members and their families out of their homes," Acting Associate Attorney General Stuart F. Delery said in a statement.

More than 950 service members will receive over $123 million from a settlement announced Monday by the U.S. Justice Department with five mortgage servicers for non-judicial foreclosures in violation of the Service Members Civil Relief Act (SCRA).

Under the National Mortgage Settlement, 666 service members and their co-borrowers will receive $88 million from GMAC Mortgage, Citi, Wells Fargo and JP Morgan Chase. Another $35 million was already paid out to 286 service members and their co-borrowers from Bank of America.

The 952 service members will receive $125,000 plus any equity in the lost property and interest on that equity under the settlement from the lawsuit. 

Co-borrowers will receive compensation for any of their share of lost equity. A non-judicial foreclosure allows a bank or mortgage servicer to sell the home without having to file a lawsuit against the owner.

A "notice of default" is issued and the home is then sold at public auction.
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