Federal agencies are investigating banks' foreclosure-documentation process after some major financial institutions have said they would either review or suspend foreclosures because of possible errors, the Associated Press reported, citing White House Press Secretary Robert Gibbs. Meanwhile, Chicago-area law enforcers are halting foreclosure-related evictions until banks provide them with affidavits legitimizing the foreclosures, AP said in a separate report Tuesday.

Gibbs said an interagency task force on financial fraud is probing the foreclosure process, while the Federal Housing Administration, which guarantees mortgages, has launched its own investigation as well. Gibbs added that the White House will support efforts from all 50 states to investigate the foreclosure process.

10 days after it halted the foreclosure process on properties in all 50 states, Bank of America (BAC) said yesterday that it would begin preparing documentation for their resumption in 23 states where judges hear these cases.

JPMorgan Chase (JPM) said on Oct. 13 that it was broadening its review of its foreclosure process to about 115,000 cases in 41 states, while Ally Bank's GMAC Mortgage unit also said last week that it would review its foreclosure procedures in all 50 states.

In Illinois' Cook County, which includes Chicago, sheriffs' deputies will hold off on carrying out about 1,500 evictions scheduled for the next few days. The AP cited Cook County Sheriff Tom Dart saying that deputies will serve notices to residents of homes ordered to be foreclosed upon by BofA, JPMorgan Chase and GMAC, but they won't enforce eviction orders.

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The Fed can't solve the problem, the Fed IS the problem. Let's not forget it was the Fed that kept interest rates artificially low which encouraged borrowing and risky lending. We need to end counterFED money now. END THE FED!!

October 19 2010 at 5:36 PM Report abuse rate up rate down Reply
1 reply to pmurph2000's comment

Yes the FED was one element, however deregulation allowed the ridiculious 'no down payment" mortgages, the 125% mortgages, the teaser rates, the no income verification loans, the securitizing of bad loans into falsely rated secrities, and the illegal selling of those bogus securities. One problem did NOT cause the market housing market to collapse, but decades of free market deregulation DID! Reaganomic is officially a failure. Stripping the government of it's regulations is a failure. Gutting the SEC is an abject failure, Having a handfull of banks that are too big to fail because the anti trust regulations that USED to be in place and stopped the too big from swallowing every competitor is an abysmal failure. 12 years of congressional deregulation allowed the inmates to take over. Hey and guess what? NONE of those regualtion have been reinstated.......NONE!!!

October 19 2010 at 6:21 PM Report abuse +1 rate up rate down Reply