Big Banks Fixing Foreclosure Processes

Bank of America and J.P. Morgan Chase told the Senate Banking Committee on Tuesday that they were making changes in their foreclosure processes after reviews found areas that needed improvement.

Barbara DeSoer, president of Bank of America’s home loan business, said the company has set up a new form for creating foreclosure affidavits.These are documents that summarize the facts of a foreclosure case such as a borrower’s name and total amount owed.

Those documents, she said, “will be individually reviewed by the signer” and notarized. The company, she said is “carefully restarting” the foreclosure process.

The Congressional Oversight Panel, however, warned in a report Tuesday that the foreclosure document problems “may have concealed much deeper problems in the mortgage market that could potentially threaten financial stability.”

A Treasury spokesmen disputed that claim, saying that 11 federal agencies are investigating the issue and they don’t believe it represents a threat to the U.S. financial system.

Source: Associated Press, Alan Zibel (11/16/2010)