Georgia’s Attorney General Chris Carr announced on Wednesdayday that the state of Georgia, in conjunction with 48 other state attorneys general, the District of Columbia and over 45 state mortgage regulators, has reached a $45 million settlement with New Jersey-based mortgage lender and servicer PHH Mortgage Corporation.
“Our settlement holds PHH accountable for harms homeowners suffered from improper loan servicing and shows our continued dedication to protecting Georgians,” said Attorney General Chris Carr. “The agreement requires new servicing standards to help ensure that the company does not repeat conduct that led to improper mortgage servicing and to provide financial relief to aggrieved homeowners.”
The settlement resolves allegations that PHH, the nation’s ninth largest non-bank residential mortgage servicer, improperly serviced mortgage loans from January 1, 2009 through December 31, 2012. The agreement requires PHH to adhere to comprehensive mortgage servicing standards, conduct audits and provide audit results to a committee of states. The settlement does not release PHH from liability for conduct that occurred beginning in 2013.
The $45 million settlement includes $30.4 million in payments to borrowers, payments to state attorneys general who helped lead the investigation and negotiations and payments to state mortgage regulators.
Borrowers who were subjected to PHH foreclosures during the eligible period will qualify for a minimum $840 payment, and borrowers who faced foreclosures that PHH initiated during the eligible period, but did not lose their home, will receive a minimum $285 payment. Approximately 2,355 Georgians are eligible for a payment. A settlement administrator will contact eligible payment recipients at a later date.