Payments start in $3.6 billion foreclosure settlement

Checks for millions of mortgage borrowers are almost in the mail as a result of a federal settlement about foreclosure abuses, but they won’t be very big in most cases.

Payments to 4.2 million mortgage borrowers are scheduled to begin Friday under an agreement reached this year between banking regulators and 13 companies that service home loans.

The agreement emerged from the government’s investigation of the so-called robo-signing scandal, in which mortgage servicers sometimes pursued foreclosures without properly prepared documents.

The settlement provides $3.6 billion in cash payments to borrowers whose primary homes were in any stage of foreclosure in 2009 or 2010 and whose mortgages were serviced by one of the companies.

The payments will range from $300 to $125,000, depending on how much harm a borrower potentially suffered as a result of actions by the mortgage servicer.

The largest number of borrowers will get $300, according to data released Tuesday by the Office of the Comptroller of the Currency.

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http://www.usatoday.com/story/money/busi…t/2067005/