People who lost their homes through foreclosure may ask for a federal review and may be eligible for compensation due to financial injury under a new program announced Tuesday in Washington by the Office of the Comptroller of the Currency.

To be eligible, the former property owner must have lost the home to foreclosure in 2009 or 2010, and the foreclosure must have been undertaken by one of a specific group of mortgage servicers (the list includes Bank of America, Chase, Wells Fargo and Citibank. See the link below for the complete list.)

Those servicers were the subject of enforcement actions taken last spring by the Officer of the Comptroller of the Currency, the Federal Reserve, and Office of Thrift Supervision.

Acting Comptroller of the Currency John Walsh said in a statement that independent reviews and other requirements will “help ensure that the servicers provide appropriate compensation to borrowers who suffered financial harm as a result of improper practices identified in our enforcement actions.”

“The challenge is substantial,” Walsh said, “but the steps we have required the servicers to take are vitally important to resolving these issues in a way that respects the rights of those who have been harmed and helps to restore confidence in the system.”

Here are a few examples of financial injury “due to errors, misrepresentations, or other deficiencies in the foreclosure process:”

  • You were doing everything the modification agreement required, but the foreclosure sale still happened.
  • The foreclosure action occurred while you were protected by bankruptcy.
  • You requested assistance/modification, submitted complete documents on time, and were waiting for a decision when the foreclosure sale occurred.
  • The foreclosure action occurred on a mortgage that was obtained before active duty military service began and while on active duty, or within 9 months after the active duty ended and the servicemember did not waive his/her rights under the Servicemembers Civil Relief Act.

Those seeking a review of their foreclosure must do so by April 30, 2011.

Click here for a list of the mortgage servicers and to read answers to frequently asked questions.

Click here to read a copy of the press release.