Banks Suspend Foreclosures After Allegations of Wrongdoing
Posted By Chris Forrest on Oct 12, 2010 3:50pm PDT
Five major banks and loan servicers have announced suspensions of foreclosures due to allegations of improper conduct in the filing of faulty legal documents in foreclosure cases. Bank of America, PNC Financial, Ally Financial (formerly GMAC Mortgage), JP Morgan Chase and Litton Loan Servicing have halted some or all pending foreclosure cases to review their foreclosure procedures and conduct internal investigations.
They are accused of using false or unverified data to fast-track foreclosures on people who default on their mortgage payments. The allegations of wrongdoing include bank representatives signing foreclosure affidavits without reading them or reviewing the documents upon which the affidavits were based.
Attorneys general in up to 40 states want to force banks and mortgage companies to revamp the way they handle foreclosures, pay financial penalties for violations and expand help to homeowners on the verge of foreclosure. The attorneys general are discussing the outlines of a settlement that would seek to correct the problems with foreclosure documents that have surfaced in recent weeks.
The Forrest Law Firm is closely monitoring these investigations. We are in contact with the Office of the Attorney General of Florida and will provide updates as new information becomes available to us.