Lawmakers Push For Halt To Foreclosure Proceedings
07 Outubro 2010 - 5:28PM
Dow Jones News
A growing number of U.S. congressional leaders are pushing
mortgage lenders to halt foreclosure proceedings in the wake of a
scandal surrounding poor documentation practices.
Senate Majority Leader Harry Reid (D., Nev.) wants mortgage
servicers in Nevada to stop foreclosing on homes until they put
into place systems to ensure that foreclosure is the only option
for a struggling homeowner.
"I'm concerned about those cases where carefully analyzing a
homeowner's income and debt would lead to the conclusion that a
modification is the best solution," he wrote in a letter to the
state's largest mortgage servicers.
"These are the cases where adjusting the terms or reducing
principal of the mortgage would result in the net present value of
the loan being greater to the lender than it would recover through
foreclosure."
Mortgage servicers have been attracting sharp criticism in
recent weeks for employing a practice called "robo" signing through
which documents are signed by computers or people who don't
properly review the paperwork. Several banks, including Bank of
America Corp. (BAC), J.P. Morgan Chase & Co. (JPM) and Ally
Financial Inc. have halted foreclosures in 23 states to review
their documentation procedures.
Rep. Edolphus Towns (D., N.Y.) is pushing for foreclosure
proceedings to be stopped in all 50 states and the District of
Columbia.
"Anyone forced to go through this process should be treated
fairly," he said.
Sen. Sheldon Whitehouse (D., R.I.) is pushing for Fannie Mae
(FNMA) and Freddie Mac (FMCC) to halt foreclosures on mortgages
they hold or control.
-By Meena Thiruvengadam, Dow Jones Newswires; 202-862-6629;
meena.thiruvengadam@dowjones.com