Starting on Friday, BofA is delaying foreclosures in 23 states because of possible problems with paperwork, the third major servicer to take such action as investigations mount into tens of thousands of potentially faulty foreclosures.
After reviewing its own process for preparing affidavits used in the foreclosure process, Bank of America decided to suspend foreclosures in those states that require judicial approval. The bank notified courts on Friday to pull affidavits in foreclosure cases that have been submitted for judgment but not yet decided, says Bank of America spokesman Dan Frahm.
Frahm says he doesn't know how many foreclosures will be affected. Customers will not be notified because, while the review may cause some delays in the judgment of the affidavits and foreclosure sale dates, homeowners should not otherwise be affected, he says.
"We have been assessing our existing processes," Frahm says. "To be certain affidavits have followed the correct procedures, Bank of America will delay the process in order to amend all affidavits in foreclosure cases that have not yet gone to judgment in the 23 states where courts have jurisdiction over foreclosures."
Two other major servicers — JP Morgan and the GMAC Mortgage unit — have either delayed or halted foreclosures in 23 states. Those actions were taken after depositions taken in lawsuits by homeowners turned up officials who said they signed documents without reviewing them or having a notary present.
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