What is the Settlement Agreement about?
The Settlement Agreement resolved potential nationwide litigation related to Chase’s mortgage servicing practices that resulted in the improper preparation and filing of payment change notices and escrow analyses for borrowers in bankruptcy.
What is a payment change notice?
A payment change notice is a form that mortgage servicers are required to file in Chapter 13 bankruptcy cases pursuant to Bankruptcy Rule 3002.1 whenever the monthly mortgage payment amount on the borrower’s principal residence changes. Such payment changes can be triggered by an updated escrow analysis, adjustments in monthly interest rates, or other circumstances, and must be filed 21 days or more before the change in the payment amount becomes effective. Please click here for the standard form for a payment change notice.
What is Bankruptcy Rule 3002.1?
Bankruptcy Rule 3002.1 is the rule that requires mortgage servicers to file payment change notices. Click here to read the complete rule.
What does Chase have to do under the Settlement Agreement?
- Under the terms of the Settlement Agreement, Chase will provide payments, credits and contributions totaling more than $50 million, and will implement operational changes as follows:
- Chase will provide $22.4 million in credits and second lien forgiveness to approximately 400 homeowners who received inaccurate payment increase notices during their bankruptcy cases.
- Chase will pay $10.8 million to more than 12,000 homeowners in bankruptcy through credits or refunds for payment increases or decreases that were not timely filed in bankruptcy court and noticed to the homeowners.
- Chase will pay $4.8 million to more than 18,000 homeowners who did not receive accurate and timely escrow statements. This includes credits for taxes and insurance owed by the homeowners and paid by Chase during periods covered by escrow statements that were not timely filed and transmitted to homeowners.
- Chase will pay $4.9 million, through payment of approximately $600 per loan, to more than 8,000 homeowners whose escrow payments Chase may have applied in a manner inconsistent with escrow statements it provided to the homeowners.
- Chase will donate $7.5 million to the American Bankruptcy Institute’s endowment for financial education and support for the Credit Abuse Resistance Education Program.
- Chase will also change its technology, policies, procedures, internal controls and other oversight systems to ensure that the problems identified in the Settlement Agreement do not occur in the future.
- In addition to the relief described above, the Independent Reviewer will verify the accuracy of Chase’s description of the nature and scope of the problems identified in the Settlement Agreement.
How do I know if I am eligible and how much relief will I receive?
The Settlement Agreement applies to specific types of consumers in bankruptcy during a specific time period. If you have questions about whether you may be eligible for relief under the Settlement Agreement, you may call Chase’s Settlement Hotline at 866-451-2327 or visit www.chase.com/mortgage for more general mortgage information.
What is the Independent Reviewer's role?
The Independent Reviewer’s role is to oversee and test Chase’s compliance with its obligations under the Settlement Agreement. This includes verifying that Chase stated with substantial accuracy the nature and scope of the problems described in the Settlement Agreement. This also includes ensuring compliance with the consumer relief and operational changes Chase undertook as part of the Settlement Agreement. The Independent Reviewer will monitor and test Chase’s compliance, keep the public informed about Chase’s progress, and ultimately seek to ensure that Chase meets the obligations set forth in the Settlement Agreement.
The Independent Reviewer’s authority does not extend to consumers who have complaints about issues that are outside the scope of the Settlement Agreement. If you believe you have an issue that is outside the scope of the Settlement Agreement, please refer to the contact information below for Chase, as well as for government agencies that may be able to assist you.
How will the Independent Reviewer conduct her job?
Ms. Walsh and her team will test Chase’s representations and remediation efforts with the assistance of experts in the field of bankruptcy and in the field of compliance testing to determine if and when Chase has complied with its obligations as required by the Settlement Agreement. Ms. Walsh has retained BDO Consulting to assist her in compliance testing and analysis, and has retained the Honorable William H. Brown, United States Bankruptcy Judge (retired), as an expert in the field of bankruptcy law and procedure.
How can consumers be sure the Independent Reviewer is independent, thorough and rigorous?
Ms. Walsh intends to fulfill her role as Chase’s Independent Reviewer in an open and transparent manner, and to foster public confidence in her oversight. Ms. Walsh will report on her work semi-annually and will respond to consumer inquiries as promptly as possible to promote transparency and confidence in the process.
If you have questions about Ms. Walsh’s Independent Review, you can contact her at firstname.lastname@example.org. If you would like to read more about Ms. Walsh and her experience, please refer to her bio.
How can consumers find out about the Independent Reviewer's work?
Ms. Walsh will provide regular updates about Chase’s compliance with the Settlement Agreement through this website and public court filings in United States Bankruptcy Court in the Eastern District of Michigan in the case In re Belzak, Case No. 10-23963-dob.
How do I get more information?
What if I have a loan issue to report?
- If you believe that you may be entitled to relief under the Settlement Agreement or if you have inquiries for Chase relating to the Settlement Agreement, please call Chase’s Settlement Hotline at 866-451-2327 or visit www.chase.com/mortgage for general mortgage information.
- If you need to report a loan or lending issue outside the parameters of the Chase Settlement Agreement, the Consumer Financial Protection Bureau may be able to assist you with your complaint. You may visit the CFPB’s website at http://consumerfinance.gov, or call 855-411-2372.
- You may also wish to report your complaint to the Financial Fraud Enforcement Task Force by visiting http://stopfraud.gov, or by calling 202-514-2000.
- If you believe you may have a loan issue that is the subject of the National Mortgage Settlement, you may view the NMS Monitor’s website at https://www.jasmithmonitoring.com/omso/.