The Justice Department announced Wednesday that members of the military whose properties were wrongfully foreclosed are eligible to receive a total of $311 million in compensation from five large mortgage servicers.
The mortgage servicing arms of JPMorgan Chase, Wells Fargo, Citigroup and Bank of America, as well as GMAC Mortgage have agreed to compensate individuals who suffered from foreclosures in violation of the Servicemembers Civil Relief Act, as delineated in the 2012 national mortgage settlement.
The companies will pay 2,413 wrongfully foreclosed service members approximately $125,000 each, in addition to lost property equity and interest. Co-owners are also eligible to receive compensation for lost equity. The foreclosures in question must have happened between Jan. 1, 2006 and April 4, 2012.
Some of the service members will be receiving compensation under the terms of the November 2011
Under the terms of the law, individuals who were serving or returning from active duty cannot be targeted for nonjudicial foreclosure; mortgage servicers must file an affidavit with the court identifying the borrower's military service status.
Borrowers facing a default judgment while serving in the military must be assigned an attorney, and are eligible for a delay of at least 90 days for the foreclosure proceedings. This only applies to mortgages originated before the borrower's military service period began.
In February, the Justice Department
