A top bank official put his best foot forward in Fort Wayne a day after eligible Hoosiers learned they could join a national mortgage settlement.
As part of the deal, more than 37,000 Indiana homeowners who were foreclosed on and subject to an error by a mortgage servicer between Jan. 1, 2008, and Dec. 31, 2011, will split $31.4 million in cash payments.
The average disbursement – $840 per household – is payback for charges of robo-signing that pushed mortgage applications through without proper review. Indiana and 48 other states this year joined the federal governments settlement with five major lenders and servicing institutions to settle the claim: Ally/GMAC, Bank of America, Citi Bank, JPMorgan Chase and Wells Fargo.
Russ Cross, senior vice president and regional servicing director for Wells Fargo, said its time to move on. Cross, whose region consists of Indiana, Michigan, Ohio, Illinois and Wisconsin, is based in Des Moines, Iowa.
In order to be good community partners, we have to do whatever we can with neighborhood stabilization, he said during a Wednesday interview with The Journal Gazette. Weve paid back all the government loans with interest.
That amounts to more than $26 billion. Since 2009, Wells Fargo has made sure about 12,400 Hoosier families avoid the stigma of foreclosure, Cross said. But that doesnt mean all homeowners retained their houses.
Some lost homes through sheriffs or short sales or deed in lieu of foreclosure proceedings. Even so, thats better than having a foreclosure attached to a credit application, Cross said.
In other instances, he said, Wells Fargo has donated some properties valued at $30,000 or less, and participated in loan modification programs and similar efforts to try to bolster the housing market.
The company is not alone. Al Thorup, executive director of the Indiana Mortgage Bankers Association in Indianapolis, said all of his groups 114 members are engaged in similar programs, including northeast Indianas Star Bank, Tower Bank and MarkleBank.
MarkleBank is merging with sister institution Grabill Bank, and beginning Oct. 9, the combined company will be known as iAB Financial Bank.
Still, Thorup believes Wells Fargos attempt to inform and educate the public is important.
Theyre being proactive, and thats good, he said. We earned a black eye with the (housing crisis) fiasco, but the fact of the matter is that the industry is filled with good people. We want to let the public know what were doing.