Thursday, September 28, 2023
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JP Morgan Reaches $50M Mortgage Doc Deal

(CN) - JPMorgan Chase will pay $50 million to settle claims it filed "robo-signed" mortgage documents to bankruptcy courts across the U.S., the Justice Department announced.

Under the deal, which is still subject to the approval of the U.S Bankruptcy Court in Detroit, Mich., JPMorgan Chase will make payments to more than 25,000 homeowners, many of whom received inaccurate payment-increase notices during their bankruptcy cases.

As part of the settlement, the agency said, bank officials admitted to filing more than 50,000 payment-change notices that were improperly singed by that bore the signatures of employees who no longer worked for the company.

The payments to homeowners will be made in the form of cash, mortgage-loan credits and loan forgiveness.

The largest portion of the settlement, about $22.4 million, will be made of up credits and second-lien forgiveness. It will go to about 400 homeowners who received inaccurate notices of payment increases during their bankruptcy cases.

For its part, the financial company said the vast majority of its payment change notices were properly reviewed and correct, but that the process of filing the notices electronically was flawed. It said it has since changed its system so the electronic signatures on those forms are correct.

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