Posted on Thursday, October 21, 2010
BY: CARRIE BAY
The House Subcommittee on Housing and Community Opportunity will hold a hearing on the industry’s foreclosure paperwork errors when Congress reconvenes next month.
The hearing, scheduled for Thursday, November 18th, will investigate the problems that have recently surfaced in the mortgage servicing industry, including improper and possibly illegal foreclosure processing.
The Senate Banking Committee, too, plans to hold its own hearing on the matter on November 16th.
Congresswoman Maxine Waters (D-California), who chairs the House subcommittee, expressed concern that the nation’s major banks themselves have revealed that improper and potentially fraudulent foreclosures have been widespread, not merely isolated incidents. Several of
the largest mortgage servicers have voluntarily suspended at least some of their foreclosure proceedings to investigate their procedures.
In a statement issued Tuesday, Waters criticized Bank of America and GMAC Mortgage for lifting their foreclosure freezes this week.
“I am disappointed by Bank of America’s rush to resume foreclosures after such a short review that calls into question how it could examine more than 100,000 mortgages so quickly,” Waters said. “I am also concerned that GMAC is moving ahead with foreclosures despite an employee’s admission that he ‘robosigned’ 10,000 foreclosure affidavits a month without verifying the accuracy of the documents.”
Waters continued, “There is ample evidence that homeowners have been harmed by wrongful foreclosures. Regulators need to initiate a full review of Bank of America, GMAC, and other servicers because we cannot leave it to the banks to review and police themselves.”
In addition to hearing testimony from industry representatives, government regulators, and outside watchdogs at the November hearing, Chairwoman Waters says she wants to examine various solutions to address the nation’s strangling foreclosure crisis.
Waters recently introduced the Foreclosure Prevention and Sound Mortgage Servicing Act (H.R. 3451), which would prohibit a bank from initiating foreclosure proceedings without offering the homeowner loss mitigation.