Kentucky’s share of the nationwide foreclosure settlement with five major banks is nearly $59 million. Attorney General Jack Conway announced yesterday how that money will be used to help borrowers struggling with high mortgage payments or who have already been through foreclosure. Some of the funds will go toward paying down principal balances for consumers who owe more than their home is worth. Conway says,
“The goal here is to make certain that we try to get a write-down of people who are underwater. The average write-down we think is going to be somewhere in the neighborhood of 20% of the loan value. The average write-down nationwide they’re estimating is going to be about $20,000 per homeowner.”
Conway says Kentuckians who were foreclosed upon in the past four years using robo-signed documents could be eligible for direct payments of up to $2,000. He says his office is still investigating issues with mortgage-backed securities and whether mortgage assignments were properly recorded.