Lenders Suspend Foreclosures
In the wake of the recent testimony that loan representatives routinely signed thousands of documents a without reviewing the documents or verifying that the information was accurate or correct, four lenders have suspended their foreclosures pending internal investigations. The following lenders have announced that they will stay foreclosures:
Bank of America
JP Morgan Chase
It is expected that additional lenders will follow suit in the near future given the widespread nature of the problems. However, Wells Fargo reported that it was not going to stay any of their foreclosures as it was confident with regard to their documents and practices.
Despite what appears to be good news, in at least one local case, attorneys for Bank of America have failed honor the stay and proceeded forward with the foreclosure litigation, stating that the stay only applies to some cases.
Caution for Occupancy Inspections
Homeowners should also be cautious for contrived occupancy or property inspections by contractors for banks which are really designed to intimidate and scare homeowners.
While the terms of most mortgages give banks the right to secure a vacant property and confirm that the borrowers reside in home, lenders are using this as collection effort where the representative will misrepresent the foreclosure process and threaten an immediate ejectment from the home.
After a homeowner has advised the inspector that they reside there and property is secured, you can direct them to leave your property as they have no legitimate reason for remaining on the property. In some cases the statements of the bank representatives have risen to a level of fraud and law enforcement has been summoned to issue a no-trespass warning.
State Attorneys General to Investigate Foreclosure Fraud
The attorneys general of up to 40 states plan to announce a joint investigation into banks' use of flawed foreclosure paperwork. An announcement could come as early as Tuesday.
Iowa Attorney General Tom Miller will likely lead the investigation. Miller already has been leading multistate reviews of questionable foreclosure documents. Additionally, Attorney General Eric Holder has said the federal government is also looking into the issue.