Recently, the California Department of Business Oversight (DBO) announced that it had joined a $40 million multi-state settlement against PHH Mortgage Corporation (“PHH”), stemming from allegations that PHH had violated federal and state laws regarding foreclosures, loan modifications and servicing. California is among 47 states participating in the settlement against PHH.
According to a press release issued by the DBO, examinations jointly conducted by the 47 participating states found that PHH “failed to exercise proper control over foreclosure documents, allowing unauthorized executions, inconsistent signatures, and improper certification and notarization, all of which affected the integrity of documents relied on in the foreclosure process. In addition, the examinations found deficiencies in other internal controls, loan servicing and modifications.”
According to the DBO, at least 3,800 California borrowers are eligible to receive refund checks under the terms of the settlement. These include California borrowers who were wrongfully foreclosed on between January 2009 and December 2012. An administrator will contact impacted borrowers, who must then submit claims back to the administrator.
The PHH settlement agreement may be viewed HERE.
This article was written by Tricia Engelhardt of Aldrich & Bonnefin, PLC