More than 200 in RI to receive payments after settlement of HSBC mortgage abuse-case
Published on: Feb 6, 2016
PROVIDENCE, R.I. (Projo) - A $470 million national mortgage-abuses settlement with banking giant HSBC includes $59.3 million for direct payments to those who lost their homes to foreclosure because of abusive lending practices.
The settlement, announced Friday, is between HSBC and the U.S. Department of Justice, the U.S. Department of Housing and Urban Development, the Consumer Financial Protection Bureau, and 49 states and the District of Columbia, according to a statement from Rhode Island Attorney General Peter F. Kilmartin.
In Rhode Island, 222 borrowers who were foreclosed by HSBC between Jan. 1, 2008, and Dec. 31, 2012, can expect to receive one-time payments of an estimated $1,200 to $1,400 as compensation, according to Amy Kempe, a spokeswoman for Kilmartin.
According to Kempe, another 946 Rhode Island homeowners "who were victim to the same bad mortgage servicing practices by HSBC yet were not foreclosed upon" during the same period may be eligible for other relief such as loan modifications, loan forgiveness and/or reductions in interest rate. The deal provides for $370 million in these kinds of relief.
The federal government will be getting $40.5 million of the settlement.
The settlement also requires HSBC comply with new standards and practices.