Banks Release $112M to New York Sandy Victims

Gov. Cuomo’s administration says banks and mortgage service companies have released $112 million in insurance checks intended for victims of Superstorm Sandy, but delayed by bureaucracy.

The New York Department of Financial Services had sought to free the checks sent from insurance companies and intended for Sandy victims, but delayed as they were processed through the victims’ mortgage holders.

The state persuaded the federal mortgage holders Fannie Mae and Freddie Mac to ease their standards to allow banks to move the checks more quickly to home owners.

Fifteen banks now agree to the department’s request to release 75 percent of the proceeds to current borrowers without requiring the usual documentation or an inspection, or $40,000, whichever is greater.

The remainder will be released with only one inspection.

The department said 6,000 checks totaling $200 million were once delayed.