By Anna Challet,
New America Media
Well over 4 million homeowners affected by the foreclosure crisis are eligible for an independent review of their cases – but only a small percentage of them have requested one through a recently available federal program, and the deadline to do so is looming.
The Independent Foreclosure Review (IFR) allows eligible current and former homeowners to have their foreclosure files reviewed by independent consultants. Homeowners who were financially harmed by abuses or errors of their mortgage servicers will be eligible for compensation.
As of September, 18 percent of eligible homeowners in California had responded to the mailing about the IFR, which is run by the Federal Reserve Bank and the Office of the Comptroller of the Currency (OCC).
Nationally, the response rate is only 7 percent. The deadline to request a review is December 31.
“The response rate has been incredibly low compared to the number of homeowners who may have been affected,” says Maeve Elise Brown, Executive Director of Housing and Economic Rights Advocates.
“There was almost no outreach to people of color or immigrants,” says Brown.
Lena Robinson, a regional manager of the Federal Reserve Bank of San Francisco, says that the IFR is particularly focused on increasing the number of African American and Asian American responders.
Mailings about the program were sent out in November 2011. Many homeowners were suspicious of the mailing and dismissed it as a mortgage scam.
Additionally, despite the Federal Reserve Bank’s intention to reach out to Asian American homeowners, the mailings were only sent in English and Spanish (with a note about where to find other translations).
“Unfortunately, a lot of the information that’s out there is not in Chinese [and other Asian languages],” says Allen Zhao, the Housing Coordinator at ASIAN, Inc.
Cheyenne Martinez-Boyette of the Mission Economic Development Agency (MEDA) adds that the foreclosure crisis “has impacted the Latino community disproportionately,” which he says represents almost 48 percent of all foreclosures..
Any homeowner whose primary residence was at some stage of foreclosure any time in 2009 or 2010, and who used a mortgage servicer on the IFR’s list of servicers and affiliates, is eligible for a review.
Homeowners who did not actually lose their homes to foreclosure are still eligible to apply. Compensation ranging from $500 to $125,000 plus equity will be determined by how much the homeowner was financially harmed during the foreclosure process. In the most severe cases, says Robinson, the foreclosure can be rescinded.
Homeowners who did not receive the IRF form can call 1-888-952-9105 or apply online: www.independentforeclosurereview.com
Homeowners can visit hud.gov for a list of housing counseling agencies that are approved by the U.S. Department of Housing and Urban Development.