Durbin Writes to Governor Quinn About Protecting Illinois Servicemembers from Excessive Mortgage Fees and Foreclosure

WASHINGTON, D.C. – January 28, 2011 – (RealEstateRama) — U.S. Senator Dick Durbin (D-IL) wrote to Illinois Governor Pat Quinn today, pledging to work together to protect Illinois servicemembers from excessive mortgage fees and foreclosure. Recent news reports have raised concerns that servicemembers are being overcharged for the mortgages and foreclosed upon in violation of their legal rights. Durbin asked Quinn to do all that he can to ensure servicemembers are aware of their rights and the resources available to them.

“Last week it was reported that JP Morgan Chase & Company is sending refunds to 4,000 service members who were overcharged for mortgages or against whom the company improperly started foreclosure proceedings,” Durbin wrote. “This is in addition to a long line of reported violations by major mortgage lenders such as Wells Fargo, Citigroup and Deutsche Bank. I propose we explore ways to ensure the substantial state and federal protections are working for Illinois servicemembers.

As home to one of the largest National Guard forces and three major military installations, Illinois must ensure that servicemembers rights are always protected. You have shown that you take that responsibility to heart. I look forward to working with you in those efforts.”

Servicemembers have a number of federal and state laws protecting their rights and looking out for their interests as consumers. The Servicemembers Civil Relief Act (SCRA) is designed to help servicemembers manage financial burdens they face as a result of military service. Active duty, reservists called to active duty and National Guard members who are on active duty for more than 30 days are protected under the law. These servicemembers may request mortgage lenders reduce interest rates and protects them from foreclosure while on active duty. Sadly, many servicemembers are unaware of their rights and face serious financial hardships as a result.

Last year, the Illinois General Assembly enacted Public Act 09-0901 which allowed Illinois servicemembers to request a stay of foreclosure proceedings if the were recently deployed. Also last year, Congress approved the establishment of the Consumer Financial Protection Bureau at the Department of Treasury. Holly Patraeus, wife of General David Patraeus, is directing the effort to establish an Office of Servicemember Affairs within the Bureau.

Durbin’s letter was also set to Illinois Attorney General Lisa Madigan, Major General William Enyart, the Adjutant General of the Illinois National Guard, Secretary of the Illinois Department of Financial And Professional Regulation Brent Adams, and Dan Grant, Director of the Illinois Department of Veterans’ Affairs.

A copy of today’s letter is pasted below and attached.

January 27, 2011

Governor Pat Quinn
207 State House
Springfield, Illinois 62706

Dear Governor Quinn:

It is my hope that we can work together to help protect Illinois servicemembers from excessive mortgage fees and foreclosure.  Recent media reports show that servicemembers across the nation have been overcharged on mortgages and foreclosed upon in violation of their rights under the Servicemembers Civil Relief Act (SCRA).  Despite legal protections at the state and federal level, Illinois servicemembers may not be aware of their rights or the resources available to enforce them.

Last week, it was reported that JP Morgan Chase & Company is sending refunds to 4,000 servicemembers who were overcharged for mortgages or against whom the company improperly started foreclosure proceedings.  This is in addition to a long line of reported SCRA violations by major mortgage lenders such as Wells Fargo, Citigroup, and Deutsche Bank.

The SCRA is designed to help servicemembers manage financial burdens they face as a result of military service.  This includes all active duty personnel, reservists called to active duty, and National Guard members on active duty for more than 30 days.  Under the Act, servicemembers on active duty may request that mortgage lenders reduce their interest rates to no more than six percent per year.  In addition, mortgage lenders may not foreclose on servicemembers while on active duty or for the nine months following their return home.

Last year, you and the Illinois General Assembly enacted Public Act 096-0901, allowing Illinois servicemembers to request a stay of foreclosure proceedings if they were recently deployed.

Also last year, Congress approved the establishment of the Consumer Financial Protection Bureau (CFPB) at the Department of Treasury.  Holly Patraeus, a long-time advocate for providing consumer education to military members and their families, has been tapped to direct the creation an Office of Servicemember Affairs within the CFPB.

I propose that we explore ways to ensure the substantial state and federal protections are working for Illinois servicemembers.

As home to one of the largest National Guard forces, and three major military installations, Illinois must ensure that servicemember rights are always protected.   You have shown that you take that responsibility to heart.  I look forward to working with you in those efforts.

Sincerely,

Richard J. Durbin
U.S. Senator

cc:
Attorney General Lisa Madigan
Secretary Brent E. Adams, Illinois Department of Financial and Professional Regulation
Director Dan W. Grant, Illinois Department of Veterans’ Affairs