Magazine article American Banker

Warren, Waters Seek Answers on Mortgage Servicer Settlement

Magazine article American Banker

Warren, Waters Seek Answers on Mortgage Servicer Settlement

Article excerpt

Byline: Victoria Finkle

WASHINGTON -- Sen. Elizabeth Warren of Massachusetts and Rep. Elijah Cummings of Maryland have launched a probe into a major settlement announced with mortgage servicers in January that halted the troubled independent foreclosure review.

The two Democrats sent a letter Thursday to Federal Reserve Board Chairman Ben Bernanke and Comptroller of the Currency Thomas Curry, requesting documents related to the foreclosure review and the settlement by Feb. 22. They said they are seeking information about performance evaluations of the foreclosure review process and its contractors, as well as documents related to the compensation of those independent contractors and the number of borrower files reviewed, including the number in which "unsafe or unsound" practices were identified.

Critics have warned that the foreclosure review process was costly and lacked independence, causing some to wonder if the $8.5 billion settlement deal was a quick and convenient way to put an end to the program.

"We share the desire of the OCC and the Federal Reserve to get more money to more people quickly, and we appreciate the information you have provided to congressional staff on this issue," the lawmakers said in the letter. "However, we believe that public confidence in the settlement -- the confidence necessary to speed recovery of the housing markets -- will exist only if the OCC and the Federal Reserve provide additional transparency into the process used and information gathered during the Independent Foreclosure Review process. …

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