Banks Could Pay Big For Foreclosure Errors

Law360, New York (June 21, 2012, 6:56 PM EDT) -- Banks could be forced to rescind foreclosures or pay more than $125,000 each to homeowners who suffered financial injury as a result of foreclosure errors, with no cap on the total payout, under guidelines released Thursday by the U.S. Comptroller of Currency and the Federal Reserve Board.

The government also extended by two months the deadline for homeowners to ask for review of their mortgage foreclosures, to Sept. 30. Consent orders issued in April 2011 required the country’s largest banks and other lenders to correct widespread...
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