Free foreclosure deadline New Year's Eve - KFDA - NewsChannel 10 / Amarillo News, Weather, Sports

Free foreclosure deadline New Year's Eve

Amarillo, TX -- Millions of homeowners across the nation and hundreds right here in Amarillo could be compensated for their foreclosed homes as part of a federal settlement - but you don't have long to act.

About four million Americans are eligible for the Independent Foreclosure Review, which is a federal program designed to right the alleged wrongs of their lenders.

As part of a consent order between federal regulators and fourteen lenders, eligible homeowners could receive anywhere from a few hundred dollars to more than one hundred thousand, depending on their situation.

The review process is free, and you should have received a letter in the mail last year if you're eligible.

Experts say it's part of an ongoing industry crackdown since the housing fallout in 2008, as Amarillo National Bank Vice President Pat Ware explains, "Mortgage lending has tightened down: lending standards are tighter, you need a higher credit score and more money down, and proof of income. Those were the kinds of things that people weren't getting back then, and now all banks - and especially community banks, which have always required those things - are really looking at those things a lot harder."

And that kind of scrutiny could lead to a more attractive market for investors, as Cindi Bulla of the Amarillo Association of Realtors explains, "When that finance market is healthy, when it's transparent, then you get private investors that are willing to invest in the mortgage-backed securities that fund more mortgages."

And another possible silver lining is the potential for an industry-wide self-improvement for American banking.

"I think in the future, we'll learn from our mistakes; back then, people were making mortgage loans based on the assumption that prices were always going to go up, and now we know that house prices can go down, so now you need to know your borrower rather than make a loan based just on collateral."

If you think you're eligible for compensation and you'd like to apply for a review, follow the links attached to this story.

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