Posted on Thursday, October 21, 2010
BY: JOY LEOPOLD
Bank of America and Fidelity National Financial have come to an agreement regarding the foreclosure paperwork issues that have plagued several of the largest lenders in the past weeks.
Under the agreement, Jacksonville, Florida-based Fidelity agreed to continue to provide title insurance for Bank of America’s recently foreclosed homes. BofA agreed to cover all court related costs and settlements related to any lawsuits, and Fidelity agreed it would defend new homeowners in court.
Charlotte, North Carolina-based Bank of America is working on similar agreements with other title insurers, though at this time it has not lifted its ban on foreclosure proceedings.
Dan Frahm, spokesperson for Bank of America Home Loans, said the bank on Monday began the process of
preparing 102,000 foreclosure affidavits for submission in the 23 states in which judicial approval is required for foreclosure.
“We anticipate that by Monday, Oct. 25, the first foreclosure affidavits will be resubmitted to the courts,” he said.
He continued, “Upon judgment, foreclosure dates will be set and Bank of America will resume foreclosure sales in such proceedings in the 23 judicial states.”
Of the other states, Frahm said, “We will continue to delay foreclosure sales in the remaining 27 states until our review is complete on a state by state basis.”
This agreement comes on the heels of assertions by some title insurers that they would no longer insure foreclosed properties for lenders. Fears of title-ownership discrepancies have put REO sales on hold until banks can verify that documents signed by “robo-signers” are valid.
Agreements between lenders and title insurers can help the REO market gain some much-needed stability.
American Land Title Association (ALTA) released a statement in support of such agreements during this foreclosure furor.
The Federal Housing Finance Agency released a directive with guidelines for servicers to take to identify and correct potential mistakes in foreclosure paperwork.
“ALTA supports FHFA’s outline for an orderly and expeditious resolution of foreclosure process issues that will provide greater certainty to homeowners, markets and other stakeholders,” said Kurt Pfotenhauer, CEO of ALT