“Second Chance” for Owners Who Lost Homes?

More than 2 million home owners who were foreclosed on or were in the process of a foreclosure during 2009 or 2010 can now ask for a review of their case, banking regulators announced this week.

The move is to help identify home owners who may have been improperly foreclosed upon, Julie Williams, chief counsel of the Office of the Comptroller of the Currency, said at a congressional hearing.

Home owners who ask for the review will receive a letter explaining their rights.

Mortgage servicers will hire independent auditors to conduct reviews of the cases and determine if home owners should receive financial compensation if the foreclosures were not done properly. They will also look for borrowers who were denied loan modifications when they may have been eligible for one.

The reviews are part of the mortgage servicer requirements called for by regulators after an investigation last fall revealed improper foreclosure practices by banks. Banks have until Wednesday to submit plans to the OCC on how they plan to revamp foreclosure practices.

Source: “Foreclosed Home Owners May Seek Case Reviews,” USA Today (July 8, 2011)

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