First Foreclosure Fraud Settlement Report Shows Preponderance of Mortgage Relief from Already-Popular Short Sales

By: David Dayen Wednesday August 29, 2012 8:40 am

The Office of Mortgage Settlement Oversight has released their initial assessment of the foreclosure fraud settlement. And what they’re finding is that banks are “paying off” their portion of the settlement by engaging in short sales with their borrowers. Which is something they were already doing in greater numbers prior to the settlement.

The report covers the time period from March 1 to June 30, and looks at the settlement in terms of gross dollars. In other words, some of the formulas for “credits” that banks get for various mortgage relief and other activities give less than a dollar-for-dollar payout. So the figures in the report refer to just the amount of relief, not how much credit the banks will get for it.