Panama City- Thursday, state and federal government officials announced a 25 billion dollar settlement with a group of banks accused of loan servicing and foreclosure abuse.

8.4 billion dollars of that money will go to help struggling home-owners in Florida.

The state of Florida is currently leading the nation in the number of foreclosed homes.

7.6 billion dollars will go into mortgage loan modifications including principal reduction.

“This is not going to be an immediate fix. This is a band-aid, if you will. Right now, in the United States, the home-owners value is 700 billion dollars below what the mortgage values are. The total program amounts to about 25 billion,” said Terry Gorbach of Tyndall Federal Credit Union.

To get any mortgage relief, your mortgage is going to have to be with one of the five major banks: Bank of America, Citi, JP Morgan Chase, Wells Fargo, and Ally/GMAC.

Over the next 60 days, an administrator will be named to figure out the logistics of the settlement nationwide.

Over the next six to nine months, the administrator, attorneys general, and mortgage servicers will identify home-owners who are eligible for immediate cash payments, principal reduction, and refinancing.
Those eligible will receive letters.

“It’s probably going to take three years from beginning to end to get this process completed,” said Gorbach.

That might not help people currently in foreclosure or getting close, but local bankers have advice for those in need.

“If you’re running into a difficult time, talk to your lender. Let them know what’s happening in your life. Are there options? They might be able to help you,” said Gorbach.

Besides the money that will eventually go to the home-owners, the state of Florida will receive a one time payment of 350 million dollars.

For more information, visit:

www.nationalmortgagesettlement.com