Allegations of unfair servicing and foreclosure practices in the Bay State have been resolved by Nationstar Mortgage LLC through a multi-million-dollar settlement.
The Massachusetts Act Preventing Unlawful and Unnecessary Foreclosures requires creditors to make a good faith effort to avoid foreclosure for borrowers with subprime loan terms.
But Nationstar, which does business as Mr. Cooper, is accused violating the law by providing modifications without considering borrowers’ ability to repay the debt.
That is according to the state’s attorney general’s office, which opened an investigation after it said
it received hundreds of complaints.
The Dallas-based company also allegedly failed to log, track and process documents for modification reviews.
“In Massachusetts, mortgage servicers are required by law to help prevent unnecessary foreclosures and keep families in their homes,” Massachusetts Attorney General Maura Healey said in the statement. “Nationstar failed to stop foreclosures, and this settlement gives homeowners in the hardest hit areas in Massachusetts a chance to stay in their homes.”
An assurance of discontinuance filed in Suffolk Superior court requires Nationstar, “the largest non-bank mortgage servicer in the country,” to
implement a loan modification program that will provide millions of dollars in relief through principal reductions to at least 500 to 600 borrowers.
In addition, over a hundred consumers who were foreclosed on will received a combined $500,000.
The settlement also requires Nationstar to update its practices, which will be subject to compliance oversight by the attorney general’s office.
