Fed Announces Plan for Unclaimed Foreclosure Settlement Funds

The Federal Reserve today announced its plan for redistributing unclaimed funds from the financial regulators’ Independent Foreclosure Review process. Unclaimed funds remaining after March 31, 2016, will be redistributed to borrowers who had already claimed funds and cashed their checks. “The Federal Reserve intends to distribute the maximum amount of funds to borrowers affected by deficient servicing and foreclosure practices,” the Fed said.

The Fed and the OCC’s payment agreement with 14 servicers provided for $3.9 billion for borrowers whose homes were in foreclosure by those servicers in 2009 or 2010. As of last month, more than $3.5 billion in payments had been completed to borrowers of the servicers.