Mr. Cooper to Pay $5.8M Settlement Over Alleged Mortgage Servicing Misconduct

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Nationstar Mortgage, which does business as Mr. Cooper, has agreed to pay approximately $5.8 million as part of a joint settlement with the attorneys general and mortgage regulators for 50 states and U.S. territories.

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The official website for the Nationstar settlement can be found at NationalNationstarSettlement.com.

The Nationstar lawsuit was originally filed by state attorneys general and state mortgage regulators in December 2020. The suit alleged that the mortgage servicer unlawfully mishandled the inbound transfer of consumers’ mortgage loans and failed to properly oversee third-party vendors, including those responsible for changing locks during the property preservation process, among other apparent practical failures.

According to the settlement website, the deal with Nationstar will provide cash payments to eligible borrowers whose mortgage loans fall under the following categories:

• Borrowers whose loans were transferred in bulk from another mortgage company to Nationstar for servicing between and including February 1, 2011 and December 18, 2017, whose mortgage became 30 days delinquent within 90 days of the service transfer, and the delinquency subsequently resulted in their loss of the property in foreclosure; and
• Borrowers whose property was inspected by Nationstar or its agent and determined to be vacant, and as a result, the company changed the lock on the property between June 24, 2011 and December 29, 2017, and either within 30 days of the initial lock change, the borrower requested access to the property, or within 90 days of the lock change, the property was reported as occupied through a subsequent inspection.

To receive a Nationstar settlement payout, eligible borrowers must complete and return the claim form included in the information packet they should have received by mail in December 2024, the settlement website relays.

The deadline to submit a Nationstar settlement claim form is March 3, 2025.

Per the website, individual payout amounts are listed in consumers’ settlement notice letters. Though final payment amounts will depend on the total number of valid claims that are filed, the site notes that borrowers will “very likely receive more” than what is listed in their letter.

The website shares that consumers do not need to prove they were harmed financially to receive a Nationstar settlement payout.

In addition, borrowers retain all of their legal rights even if they participate in the settlement, the site says. However, the website points out that any payout a consumer receives from the deal could reduce payments for which they may be eligible in other legal proceedings.

The settlement agreement was issued the same day that the Consumer Financial Protection Bureau (CFPB) filed a complaint against Nationstar over similar allegations. The CFPB’s stipulated judgment and order, issued December 8, 2020, required Nationstar to pay roughly $73 million in redress to more than 40,000 harmed borrowers, on top of a $1.5 million civil penalty.

All told, Nationstar has paid or will pay a collective total of more than $91 million through the settlements with the CFPB and state attorneys general and mortgage regulators, the settlement agreement relays.

Did you know that some class action settlements require no proof to submit a claim? Check out the latest open class action settlements.