Fed: Problems with Cashing Foreclosure Settlement Checks Corrected

Although about 50,000 checks from the recent foreclosure settlement have been cashed or deposited as of Monday, according to the ""Federal Reserve"":http://www.federalreserve.gov/ and the ""Office of the Comptroller of the Currency"":http://www.occ.gov/ (OCC), not all recipients were able to cash their checks due to insufficient funds.

[IMAGE] In a ""statement"":http://www.federalreserve.gov/newsevents/press/bcreg/20130417a.htm issued Wednesday, the Fed announced ""early problems with some checks have been corrected"" and ""funds are available to cash all checks.

The Fed stated early recipients of the checks called the Fed's consumer helpline on Tuesday after being told their checks could not be cashed.

As a result of the calls, the Fed contacted Rust Consulting, Inc., the paying agent, and The Huntington National Bank, the paying bank, regarding the issue, and now the ""problems that led to some checks being rejected"" have been corrected, the Fed stated.

""We apologize to anyone who experienced problems trying to cash their checks. We are working hard and communicating with the banking regulators, the servicers, and other banks to ensure those issues are not repeated,"" said Rust Consulting SVP James Parks in a release.

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Before the announcement from the Fed, complaints of the checks had surfaced online. In the ""response"":http://uprisingradio.org/home/2013/04/15/the-nation-foreclosure-review-report-shows-that-the-occ-continues-to-bury-wall-streets-bodies/#comment-622104 section for an article posted on ""UprisingRadio.org"":http://uprisingradio.org/home/, one individual posted a comment on April 15 and stated he received a check for $6,000, but was told it was ""insufficient"" and questioned whether it was a scam.

The ""initial wave"":http://dsnews.comarticles/first-wave-of-payments-from-foreclosure-settlement-scheduled-april-12-2013-04-09 of payments for borrowers covered by the foreclosure settlement with 13 servicers was sent April 12 and included 1.4 million checks.

About 4.2 million borrowers who were in any stage of the foreclosure process between 2009 and 2010 and had a mortgage serviced by one of the servicers in the settlement are eligible for a payment ranging from $300 to $125,000.

The servicers in the settlement, which required them to pay $3.6 billion in cash, are Aurora, Bank of America, Citibank, Goldman Sachs, HSBC, JPMorgan Chase, MetLife Bank, Morgan Stanley, PNC, Sovereign, SunTrust, U.S. Bank, and Wells Fargo.

The final wave of payments is scheduled to be sent in mid-July of this year, but 90 percent of the total payments should be sent by the end of April. Payments for eligible borrowers of Goldman Sachs and Morgan Stanley have not been scheduled yet.

The settlement replaced the Independent Foreclosure Review first issued through consent orders from federal regulators.

Borrowers who have problems or concerns regarding their check can call Rust Consulting, Inc. at 1-888-952-9105, Monday through Friday from 8 a.m. until 10 p.m. or on Saturday from 8 a.m. to 5 p.m. EDT.