JPMorgan Chase has paid out nearly 90 percent of its $4 billion consumer relief obligation under the terms of the 2013 JPMorgan Chase Residential Mortgage-Backed Securities Settlement, according to a report from the office of independent monitor Joseph A. Smith, Jr released Thursday.
Smith credited Chase with a total of $3.5 billion in consumer relief in his sixth report on the bank's progress since the November 2013 settlement over the selling of toxic mortgage-backed securities to investors. The bank has more than two years to pay the remaining $0.5 billion.
"I have credited Chase with $3,555,280,673 in consumer relief to 158,107 borrowers through March 31, 2015," Smith said. “I will continue to monitor and report on Chase’s progress until Chase provides the required $4 billion in credited consumer relief by December 31, 2017."
Since Smith's fifth report was issued in July, which covered up to December 31, 2014, the monitor has credited Chase with $231.2 million in consumer relief to 6,671 families. The majority of that relief came in the form of first lien forbearance, with $106.7 million to 3,790 families. In first lien principal forgiveness, 1,306 borrowers received $78 million in relief, and 1,575 borrowers received $46.5 million in second lien principal forgiveness (including extinguishments) during the three-month period from January 1, 2015, to March 31, 2015.
Chase's internal review group claimed an additional $126.2 million in consumer relief for the period from April 1, 2015, to June 30, 2015. Smith's team is currently in the process of validating that total and he said he will report the results before the end of the year. If it is credited, it will bring Chase's claimed total of consumer relief to $3.68 billion. The gross amount of relief Chase has provided before crediting through June 30, 2015, is $19.6 billion to 161,802 families
"We continue to help thousands of families become homeowners and assist those who may be struggling," a Chase spokesperson said in an email to DS News. "We have helped nearly 162,000 families through more than $19 billion in total mortgage relief."
"We have helped nearly 162,000 families through more than $19 billion in total mortgage relief."
Chase settled with the government in November 2013 for a then-record $13 billion amid claims that the bank, along with Bear Stearns and Washington Mutual, sold faulty residential mortgage-backed securities to investors prior to the financial crisis. Chase was required to make $9 billion in direct payments to government agencies and five states and provide $4 billion in consumer relief. Chase's $13 billion settlement remained a record amount for one institution settling with the government until Bank of America settled for $16.65 billion in August 2014 over similar claims of selling faulty mortgage-backed securities.