More than 700 Kansas consumers may be eligible for relief under the terms of a settlement reached with HSBC, Attorney General Derek Schmidt said today.
The agreement filed today in U.S. District Court for the District of Columbia provides direct payments to Kansas borrowers whose loans were serviced by HSBC and who lost their home to foreclosure between Jan. 1, 2008, and Dec. 31, 2012. The settlement also includes other relief for borrowers in need of assistance, such as loan modifications, new mortgage servicing standards and oversight authority to prevent future violations. Schmidt joined attorneys general from 48 other states, as well as the District of Columbia, U.S. Justice Department and U.S. Department of Housing and Urban Development and the Consumer Financial Protection Bureau in the settlement.
“Our office continues to investigate the improper conduct by mortgage servicers during the financial crisis,” Schmidt said. “Today’s settlement marks another step to holding servicers accountable for these unacceptable practices and repaying Kansas consumers for the damage that was done.”
The settlement resolves alleged violations in HSBC foreclosure practices, such as robo-signing, improper documentation and lost paperwork. HSBC is required to substantially change its mortgage servicing and foreclosure practices to prevent future abuses.
The agreement’s mortgage servicing terms largely mirror the 2012 National Mortgage Settlement (NMS) reached between the federal government, 49 state attorneys general, including Kansas, and the five largest national mortgage servicers. That agreement provided consumers nationwide with more than $50 billion in direct relief, created new servicing standards and implemented independent oversight. A subsequent state-federal agreement with SunTrust Mortgage Inc. worth nearly $1 billion was announced in June 2014.
Compliance with the settlement will be overseen by the NMS monitor Joseph A. Smith Jr. for one year. Consumers who are eligible for the cash payments will be contacted by the settlement administrator but may also contact HSBC directly for more information. Borrowers whose loans are currently serviced by HSBC can call HSBC directly at 877-601-7020 to request assistance under this settlement.
More information on this settlement and the National Mortgage Settlement is available on the Attorney General’s Consumer Protection website at www.InYourCornerKansas.org. Residents are advised that scam artists may attempt to contact homeowners offering to help them receive part of the national mortgage settlement. Homeowners will be contacted directly by the settlement administrator if they are eligible to participate. The help being offered as a part of this settlement is free of charge. You will never have to pay a fee or a percentage to be considered for eligibility. If you are asked for a fee, contact the attorney general’s office.
