Banks, state AGs near foreclosure settlement: report

NEW YORK Tue Nov 16, 2010 5:04pm EST

1 of 6. A vacant home for sale is pictured in Yonkers, New York, October 26, 2010.

Credit: Reuters/Mike Segar

NEW YORK (Reuters) - U.S. banks and a task force of the nation's 50 state attorneys general are nearing a settlement of an investigation into the lending industry's foreclosure practices, CNBC said on Tuesday.

A settlement would call for Bank of America Corp, JPMorgan Chase & Co and others to contribute money to a fund to assist borrowers who lost their homes to foreclosure and which would be administered by the regulators, CNBC said.

It would also involve a promise by banks to do away with "dual-track" modifications and foreclosures, a much-criticized practice in which they begin foreclosure proceedings before exhausting attempts to modify home loans, CNBC said.

The task force is being led by Tom Miller, the attorney general of Iowa. A settlement might not be reached for at least one month, CNBC said.

Mortgage lenders have received much criticism for employing "robo-signers" who sign hundreds of foreclosure documents at a time without knowing or understanding their contents.

Miller, Bank of America and JPMorgan did not immediately return calls seeking comment.

(Reporting by Jonathan Stempel and Jonathan Spicer in New York; editing by Andre Grenon)

We welcome comments that advance the story through relevant opinion, anecdotes, links and data. If you see a comment that you believe is irrelevant or inappropriate, you can flag it to our editors by using the report abuse links. Views expressed in the comments do not represent those of Reuters. For more information on our comment policy, see
Comments (7)
anarcurt wrote:
Kick out the dead beats. The more of these people to get evicted the more houses for us responsible people as well as more affordable prices.

Nov 16, 2010 2:52pm EST  --  Report as abuse
Sacorp wrote:
I hope people challenge the heck out of these documents. There is a lot more to this than just bad paperwork.

Nov 16, 2010 3:01pm EST  --  Report as abuse
Let’s see if I have this right. The COP states in the best case scenario “concerns about the paper work mess are overblown and banks would be able to proceed with foreclosures as soon as invalid court docs were replaced with proper paperwork.”!! The last time I checked submitting fraudulent docs to any Court is a serious violation of the law and as such those parties are subject to prosecution, fines and imprisonment. State laws vary but if the chain of mortgage title is broken for any reason- the home owner has the legal right to demand proof of proper documentation from the mortgage company. If that Co. cannot provide proof in a timely fashion the occupants own the home. The Banks are guilty not just “accused” as the above article states- bank employees have confessed to signing tens of thousands of documents with out verifying their contents at all. CitiFinancial is conspicuous in their absence from most of the articles I have read thus far. In 2004 CitiFinancial a loan servicer not a bank was fined $70 million by the Fed Reserve, a private corp for violating Reg. B and Z of the Bank Act. which involves illegal loan documentation behavior by Citi employees and Z charges involved lying to investigators. CitiGrp. could not challenge the fine, or have it reviewed in open court. The money was paid to the Treasury dept. and the story vanished. Our Gov. has known about illegal banking activities for decades and done nothing to help the people who pay to support a system that is corrupt and rotten to the core. The banksters are looting our institutions and unless we organize a concerted opposition they will steal your most precious asset -your home. Learn your state laws Loan servicer CitiFinancial is not a party of interest in a foreclosure action since they are not a bank they cannot stand as the Plaintiff in a fore- closure action. CitiGrp is the bank unless they appear as the moveant the claim must be rejected by the Courts and the case dismissed. As Ronald Reagen ironically said, “The Gov. is the problem” We must educate ourselves and demand a fair hearing from a Court of Competent Jurisdiction. Most local Judges don’t know the laws and rather then admit their ignorance they often side with the banks. If we allow people to be thrown out of their homes as winter approaches we are as guilty as the criminals who ran the scam.
I discovered an attorney representing Citi was not legally allowed to act in NY courts. A female attny signed his papers and the Court refused to hear evidence. Finally the AG in NY took action once I notified them and the Fclosure was stopped two days before the home owner was to be thrown out! Blame whomever you want but We the People are the only solution. Speak up Opt out while there’s still time.

Nov 16, 2010 3:44pm EST  --  Report as abuse
This discussion is now closed. We welcome comments on our articles for a limited period after their publication.