A number of state attorneys general (AG) sent out nearly identical notices this week regarding the April $25 billion, 49 state settlement with mortgage servicers.  The notice, addressed to borrowers who lost their homes to foreclosure between January 1, 2008 and December 31, 2011 advised of possible compensation from the settlement and that the claims process has begun.

Eligible borrowers are those who had mortgages with Ally/GMAC, Bank of America, Citi, JPMorgan Chase and Wells Fargo, the nation's five largest mortgage servicers.  The settlement with these servicers earmarked $1.5 billion in payments for 1.75 million borrowers who lost their homes to foreclosure during the designated period. The payments will be at least $840, and will very likely be higher, depending upon the number of borrowers who decide to participate.

The national settlement administrator notified eligible borrowers about the settlement by mail last week and packets with claim forms, instructions, and explanatory information are now available.  MND received identical notifications about the claims process from seven state AG offices this morning, each saying that packets were being mailed to borrowers today so we assume the mailing was national in scope.  Eligible borrowers who do not receive a packet should contact their own state AGs office.

The deadline for all claims is Jan. 18, 2013. Payment checks are expected to be mailed in 2013.