Bank to Compensate Thousands of Wrongfully Foreclosed U.S. Homeowners

 Posted on March 02, 2013 in Foreclosure

British bank HSBC is going to pay $96 million to American homeowners and over $150 million in mortgage relief because its U.S. division unjustly foreclosed on homeowners who had the right to stay in their homes, the Huffington Post reported on January 18. HSBC will pay almost $100 million in cash compensation to over 110,000 homeowners. Additionally, the bank will have to pay $153 million, which will be used “toward reducing mortgage balances and forgiving outstanding principal on home sales that generated less than borrowers owed on their mortgages.” A single homeowner can expect a compensation that can range from several hundreds of dollars to $125,000, depending on the type of error made.

The settlement is similar to deals with 12 other banks, and in total, the 13 banks will pay $9.3 billion. The settlements may compensate homeowners who lost their homes due to improper foreclosure practices such as “robo-signing.” However, consumer advocates think that regulators settled for too low a compensation. After all, the effects of foreclosure can be devastating to families.

A foreclosure can happen when a borrower defaults or is unable to repay a mortgage debt, and the lender decides to take possession of the property to get back some of the loss. The recent housing crisis has brought over 4 million foreclosures and is far from over. If you are facing foreclosure, you should immediately contact a lawyer who can defend your rights and interests.

Make sure you don't lose your home to foreclosure. Contact a highly skilled foreclosure defense attorney in Illinois at your earliest convenience.