Consumer Law

Obama Administration, State AGs, and Banks May Be on Brink of Deal Concerning Sloppy and Fraudulent Foreclosures

By Brian Wolfman

We have blogged before on revelations that many mortgage foreclosures resulting from the recent financial crisis were not supported by adequate documentation. You'll recall that some banks temporarily halted their foreclosures and state attorneys general took action to try to put a halt to sloppy and fraudulent foreclosure practices. Now, there's a report that the Obama Administration, the state AGs, and the major banks are working on a global deal that would require the banks to pay a $20 billion penalty (how the penalty would be spent is unclear) and to reform their foreclosure practices going forward. The report does not explain what, if anything, is going to be done to clear up the legal status of a property bought after an unlawful foreclosure.

Full post as published by CL&P Blog on March 04, 2011 (boomark / email).