The Allmand Law Firm, PLLC Difference

Unlike most bankruptcy firms in the Dallas / Fort-Worth area, Allmand Law Firm, PLLC spends the time to understand the complete financial picture for every one of our clients. We provide resources, tools and advice to address the unique needs of North Texans.

Millions Misspent After Texas Receives Financial Windfall from National Mortgage Settlement

Posted By Allmand Law Firm, PLLC || 3-Dec-2015

Three years ago, Texas homeowners facing foreclosure were given a glimmer of hope in the form of a $25 billion national settlement from five lenders who were accused of wrongfully forcing people out of their homes: Citi, Bank of America, JP Morgan Chase, Wells Fargo, and Ally. This money was earmarked to provide relief for Texas citizens, but so far, none has been spent to help struggling homeowners.

These five lenders, as part of their agreement, set aside funds with the purpose of making it less difficult for people to obtain loan modifications and other assistance. A huge chunk of this money ($124 million, to be exact) was, however, paid directly to the state of Texas. What happened to this money? An investigation by WFAA revealed that thousands of struggling homeowners who have lost or are in the process of losing their homes in needless and preventable foreclosures have not received a penny of it. Instead, Texas Attorney General Greg Abbott directed the money into the state’s general fund.

While lawyers for the Texas AG’s office contend that this was the only course of action for what to do with the money, many lawmakers believe this was action was a wrongful diversion of the settlement money and that it was squandered for purposes other than addressing the foreclosure crisis.

Lawmakers have been threatened with litigation similar to what happened in California, where a similar misappropriation of funds took place. In July, a judge ruled that the state improperly diverted money to prop up state funds and was ordered to return $331 million to a special housing fund. If this is any indication, Texas may soon face similar action.

Read more about this story online via WFAA.

Facing foreclosure in the Dallas/Fort Worth area? Allmand Law Firm, PLLC may be able to help. Call us today to discuss your options during a consultation: (214) 238-9608.

Categories: Foreclosures, News
Blog Home