More than 430,000 Californians who have been foreclosed on may be getting a check in the mail around the middle of next year.
California Attorney General Kamala Harris announced that the refund process just began for certain foreclosure victims as part of the National Mortgage Settlement. Of the $25-billion settlement, $1.5 billion aims to compensate borrowers who were wrongfully foreclosed upon.
"This is for people whose foreclosure were either done improperly, who might have been dual-tracked -- which means they applied for a loan modification at the same time that they were being foreclosed upon -- or if they have suffered financial hardship that their bank didn't take into account," said Lynda Gledhill, a Calif. Attorney General's Office spokeswoman.
It only applies to customers who were foreclosed on between 2008 and 2011 and who had a mortgage with the five banks involved in the settlement, including Wells Fargo and Bank of America.
The claim forms will be landing in mailboxes over the next several weeks.
"We really should be compensated," said Kenneth Hamilton, a foreclosed homeowner. "I believe the banks knew what they were doing when they did it."
The Attorney General Office's worries that victims might think their notices are a scam. But there's one way to tell that they're not.
"What's key about this claim form is that it will not ask you for any of your financial information, because the banks already have that," said Gledhill.
It's unclear how much people are going to get, but the smallest check will be for $840. It could be more depending on how many of the 2 million people eligible nationwide actually file a claim.
This is just the first wave of money that will be distributed under that $25-billion settlement to people who have lost their homes. Some of the funds will also go to current struggling homeowners.
