Checks totaling more than $15 million will be sent beginning next week to more than 10,000 Maryland mortgage borrowers, Attorney General Douglas F. Gansler announced Wednesday.
The checks, roughly $1,480 each, will be sent between June 10 and June 17 to borrowers who submitted a valid claim through the National Mortgage Settlement, he said in a statement.
"Although this payment won't fully compensate borrowers for the loss of their home due to mortgage servicing abuses, it does provide some relief and is much higher than the minimum $840 check amount initially announced," Gansler said.
The settlement was the result of accusations that the five largest mortgage servicers in the U.S. engaged in abusive servicing and foreclosure practices, including robo-signing — the practice of creating foreclosure documents in an assembly-line fashion without verifying their accuracy.
Wells Fargo, Bank of America, Citigroup, JPMorgan Chase and Ally Financial entered into the settlement last year with 49 states' attorneys general and the federal government to resolve the allegations.
The one-time cash payments set to be sent this month will go to 10,470 borrowers who had their mortgage serviced by one of the five participating banks, lost their home to foreclosure between Jan. 1, 2008 and Dec. 31, 2011 and submitted a rightful claim.
People who receive one of these checks are not barred "from seeking additional relief through a separate lawsuit or other claims," Gansler's statement said.
In addition to these checks, the National Mortgage Settlement has led banks to provide relief to borrowers including mortgage modifications, principal reductions, deficiency waivers, refinancing and short sale assistance.
"These payments add to the $1.3 billion in relief already received by Marylanders," Gansler said.
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