WASHINGTON — The Federal Reserve Board is using YouTube to try to reach more borrowers who may be eligible to have their foreclosure files reviewed as part of consent agreements with the 14 largest mortgage servicers.
The Fed released a video Wednesday that explains how borrowers who believe they were harmed by the foreclosure process in 2009 and 2010 can request an independent review. The video, which is available in English and Spanish, reminds borrowers that they may be eligible for compensation if the review finds evidence of financial injury.
Under consent orders signed in April 2011, the 14 servicers were required to hire independent consultants to review a sampling of foreclosure files from 2009 and 2010 for servicer errors, as well as any reviews requested by borrowers who were in some stage of foreclosure during that time. The review is separate from the $25 billion settlement that state and federal officials reached with the top five mortgage servicers in February.
Consumer and housing advocates have complained that regulators, including the Office of the Comptroller of the Currency, and servicers haven't done enough to reach out to eligible borrowers.
As of April 30, only 164,627 borrowers had requested reviews from servicers regulated by the OCC, a small fraction of the approximately four million who are potentially eligible. The independent consultants have also selected 142,072 files from OCC-regulated banks to review through the sampling process, bringing the total number slated for review to 306,699.
"That number is likely to grow as the deadline approaches and consultants select additional files for review," OCC Spokesman Bryan Hubbard said Wednesday.
The latest number of files slated for review was not immediately available from the Fed.
On May 1, the OCC launched a second round of English and Spanish public service announcements, distributed to 10,000 small print publications and 6,000 small radio stations, including outlets that specialize in serving communities that speak languages other than English and Spanish, Hubbard said.
The 12 servicers regulated by the OCC also launched a second round of advertising in late April, and have another round planned prior to the July 31 deadline for requests. They also plan to send a second round of letters directly to borrowers who may be eligible but have not yet responded.