Chase Halts Foreclosures in Process

September 29, 2010 No Comments »

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JP Morgan Chase has halted foreclosures until a review of its document-filing process is completed, according to the WSJ.

The New York City-based bank said the move affects roughly 56,000 home loans in some stage of the foreclosure process.

Chase spokesman Tom Kelly announced that there were cases where employees may have signed affidavits about loan documents on the basis of file reviews done by other personnel.

As a result, the bank and mortgage lender must now re-examine documents tied to loans already in foreclosure to verify if they “meet the standard of personal knowledge or review” where required.

Back in May, law firm Ice Legal LP dropped Chase document-signer Beth Ann Cottrell after it became known that she signed off on roughly 18,000 foreclosure affidavits and other documents each month without actually reviewing the files.

And last week, GMAC Mortgage told brokers and agents to immediately stop evictions, cash-for-keys transactions, and lockouts in 23 states after the company warned it could need to take corrective action in connection with some foreclosures.

Sign of the times…a year ago it was all about foreclosure moratoriums to help borrowers in need, and now it’s all about lenders making sure they don’t get into hot water over their suspect loss mitigation activities.

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