Bank Offers $56M to Repay Military Families
The case was initially brought by Capt. Jonathon Rowles, who says he was overcharged about $900 per month by Chase, which had him to verify his active duty status every 90 days and to reapply for SCRA status at least once per quarter between December 2007 and March 2010, according to the lawsuit.
The SCRA, signed into law by President George Bush in 2003 to replace a similar 1942 law, helps servicemen and servicewomen with certain financial obligations at or mortgagemortgage relief from their lender.
JPMorgan Chase has now offered to cut the interest rates for those military homeowners who did not see a correct cut initially, and it will give back homes to those who were wrongfully foreclosed upon, as well as forgive their mortgage debt. The lender also will pay $27 million in cash to the 6,000 military personnel who were overcharged on their mortgages while they were on active duty. That comes to about $4,500 per family.
JPMorgan already handed out about $6 million to those overcharged with higher interest rates. Of course, if a military member's home was already under 6 percent and wasn't due to increase on an ARM, they didn't get caught in some of this mess, unless they missed a payment and were being pursued for being delinquent.
JPMorgan officials said three months ago that one of the bank's units had made errors in the handling of mortgages covered by the Servicemembers Civil Relief Act. The lender will also contribute $15 million to a fund to go toward additional damages.
For more on mortgages and related topics see these AOL Real Estateguides:
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- Mortgage Jargon in Simple Terms
- How Much Home Can I Afford?
- How to Buy Foreclosures