More than 1,000 Massachusetts residents will receive a total of $2 million as part of a nationwide settlement with Texas-based Nationstar Mortgage.

Nationstar Mortgage, which operates under the brand Mr. Cooper, was ordered to repay $73 million to roughly 40,000 homeowners for repeatedly failing to provide even the most basic operations as a mortgage servicing company over four years, the Consumer Financial Protection Bureau said Monday.

The CFPB and 48 states alleged in their complaint that Mr. Cooper failed to do a laundry list of basic services for the mortgages it serviced from 2012 to 2016, from failing to identify mortgages that were in loan modification plans, to failing to disburse borrowers’ property tax payments.

The company also failed to inform borrowers when they no longer needed to make private mortgage insurance payments, or kept them paying for private mortgage insurance when they no longer had it.

Nationstar will repay approximately 40,000 borrowers about $73 million in refunds and damages, and will pay a $1.5 million fine to the CFPB. The company is settling independently with the 48 states, the District of Columbia, the U.S. Virgin Islands and Puerto Rico.

In a statement, the company said it identified these problems several years ago and is “pleased to resolve this matter.”

The settlement would yield nearly $85 million in recoveries for consumers to date and over $6 million more in fees and penalties, the CFPB said in a statement.

Massachusetts Attorney General Maura Healey in 2018 had settled with Nationstar Mortgage for almost $15 million.

The settlement announced yesterday provides another $1,953,627 affecting 1,015 loans in Massachusetts, the attorney general’s office said in a statement. The settlement covers conduct by Nationstar occurring from Jan. 1, 2011, until Dec. 31, 2017.

“Nationstar turned its back on families who were trying to stay in their homes and were desperate for help,” Healey said in a statement. “This settlement, reached with our colleagues across the country, secures relief for homeowners in addition to the nearly $15 million our office has already obtained from this company. We will continue to monitor this industry to ensure that all mortgage servicers respect the rights of homeowners under our laws.”

The settlement requires Nationstar to conduct compliance testing. An executive committee was formed to receive reports and communications from Nationstar on behalf of the government agencies and regulators involved with the settlement. The initial committee will include Massachusetts Commissioner of Banks, Mary Gallagher, and Connecticut Attorney General William Tong.

Massachusetts will receive $90,000 for administrative costs associated with its role in resolving the examination and settlement with Nationstar, according to the consent order.

The Associated Press contributed to this report

Massachusetts Residents Receive $2M in Mr. Cooper Settlement

by Banker & Tradesman time to read: 2 min