Mortgage lenders ordered to appear in NJ court

[Modbert]

Mortgage lenders ordered to appear in NJ court - Yahoo! News

NEWARK, N.J. – Six lenders who have combined to file nearly 30,000 foreclosure actions in New Jersey this year face the possible suspension of their operations next month under a court order announced Monday by state Supreme Court Chief Justice Stuart Rabner.

The action follows a report submitted to the Supreme Court that, citing depositions and court filings in other states, paints a picture of systemic abuses in the filing of foreclosures that include so-called "robo-signing," in which employees signed hundreds of documents without checking them for accuracy.

In one instance cited in an administrative order, an employee of OneWest Bank, formerly IndyMac Federal Bank, said in a deposition that she signed 750 documents a week, taking no more than 30 seconds per document and relying on others to check the documents' accuracy prior to signing.

OneWest and five other lenders were ordered to appear in state Superior Court in Trenton on Jan. 19 to demonstrate why the state shouldn't suspend their foreclosure actions. The others are Ally Financial, formerly GMAC; BAC Home Loan Servicing, a subsidiary of Bank of America; JP Morgan Chase's Chase Home Finance; Wells Fargo Financial New Jersey and CitiResidential Living, a subsidiary of Citibank.

The six lenders scheduled to appear in court next month have processed more than 29,000 foreclosures in New Jersey this year, Rabner said. The other 24 have filed about 16,000. The total represents nearly three-quarters of the 65,000 foreclosures filed in New Jersey, a number that has tripled since 2006, Rabner said.

More problematic, he said, is that 94 percent of the foreclosures have been uncontested, often due to homeowners' inability to afford legal counsel.

 

[william the wie]

Nevada and Arizona are contemplating similar actions.

 

[Revere]

Foreclosure is a market force that affects a lender's willingness to make home loans.

No foreclosure, no home loans because it tips the risk the wrong way.

Double dip housing bust incoming.

 

[william the wie]

Between putbacks and state court rulings Wells Fargo and BofA will end up with new owners. The shake-out of hinky banks may or may not go further.