WASHINGTON, D.C. – May 9, 2013 – (RealEstateRama) — Some borrowers whose mortgages were serviced by Goldman Sachs and Morgan Stanley and who were already sent a check as part of the Independent Foreclosure Review payment agreement will be sent an additional payment around May 17, Rust Consulting announced Wednesday Leaving the Board. The payments are being made to correct an error by Rust Consulting, the paying agent, when the original payments were sent last week.
As Rust Consulting has announced, approximately 96,000 borrowers whose loans were serviced by the former subsidiaries of Goldman Sachs (Litton Loan Servicing LP) and Morgan Stanley (Saxon Mortgage Services, Inc.) were sent checks for less than the payment amount that the Federal Reserve directed Rust to pay. The new checks will make up the difference between what was in the original check sent by Rust and what should have been paid. Borrowers should cash both the original checks and the supplemental checks.
The Federal Reserve Board became aware of a possible discrepancy on Tuesday and immediately contacted Rust Consulting to assess the problem. The Federal Reserve was advised that on May 3, 2013, Rust sent checks to the affected borrowers–approximately 96,000 of the more than 217,000 Goldman Sachs and Morgan Stanley borrowers who were mailed checks on May 3–that were incorrect. The checks were for amounts that were smaller than the amounts that the Federal Reserve had specifically instructed Rust to send those borrowers. The Federal Reserve directed Rust to distribute the supplemental payments to affected borrowers as soon as possible.
The Federal Reserve will continue to closely monitor the payment agreement and Rust’s work in distributing checks under the agreement. Rust has determined that the error was limited to borrowers whose mortgages were serviced by Goldman Sachs and Morgan Stanley.
For more information about the settlement between 13 mortgage services, the Office of the Comptroller of the Currency, and the Federal Reserve–including the amounts that are to be distributed to affected borrowers–go to www.federalreserve.gov/consumerinfo/independent-foreclosure-review-payment-agreement.htm. Borrowers whose mortgages were serviced by all 13 of the institutions should call Rust at 1-888-952-9105 if they wish to confirm eligibility, update their contact information, or get answers to further questions.
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