Bank of America Restarts Foreclosure Sales

December 10, 2010 No Comments »

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Bank of America announced late Thursday that it had resumed foreclosure sales, starting with vacant and non-owner occupied properties.

The mortgage lender had announced a voluntary freeze on foreclosures back in October in order to review its processes amid the robosigning scandal.

“The review shows the basis for our foreclosure decisions has been accurate,” said Barbara Desoer, president of Bank of America Home Loans, in a statement.

“We have identified areas of our process that can be improved, and while we make these improvements, it’s important that we move ahead with efforts to reduce the number of abandoned properties across the country. These properties can drag down home values in neighborhoods and slow the eventual recovery of the housing market.”

The company previously announced that it was restarting its process for submitting affidavits in the judicial foreclosure states, and resulting court judgments determined that foreclosure sales would proceed, though they did acknowledge some errors.

This month, Bank of America has given foreclosure attorneys approval to proceed with approximately 16,000 foreclosure cases.

However, the Charlotte-based bank noted that one-third of the properties it services are vacant at the point of foreclosure sale.

Bank of America Holiday Foreclosure Moratorium

Bank of America also announced that it will suspend both foreclosure sales and evictions from December 20 to January 2 on loans and properties held in the bank’s investment portfolio or held by other investors who provide delegated authority to the bank.

Additionally, the company has stepped up its loan modification procedures, and will deploy 2,500 associates from other areas of its Home Loan business to support these retention initiatives.

As a result, the Bank of America default management team will grow to 29,000, more than three times the size of the department just two years ago.

My guess is that the slow down in loan origination volume tied to higher mortgage rates will push some loan officers into loss mitigation roles.

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