Foreclosure Freeze Thawing

Bank of America and GMAC lift nationwide freeze on foreclosures.

Both Bank of America and GMAC Mortgage are reportedly lifting, or partially lifting, the freeze on foreclosures, citing that a paperwork review shows no problems.

The move by Bank of America, the largest mortgage servicer, marked one of the first positive developments for a financial sector under pressure after two weeks of damaging accusations that shoddy paperwork forced some people illegally out of their homes.

GMAC Mortgage was the first company to halt foreclosures in 23 states because of concerns that the legal paperwork was not validated and processed correctly. After two months of reviewing individual case files, the company says it will restart foreclosure proceedings.

While both companies say they have found no instances in which a homeowner was wrongly foreclosed upon, at least one county sheriff in the judicial state of Illinois says he’s not going to carry out their evictions until they provide further proof.

In other news, Bank of America and Fidelity National Financial have come to an agreement regarding the foreclosure paperwork issues that have plagued several of the largest lenders in the past weeks. Under the agreement, Jacksonville, Florida-based Fidelity agreed to continue to provide title insurance for Bank of America’s recently foreclosed homes.

Meanwhile, state attorneys in general continue to push for a halt to foreclosure sales, saying they have little confidence that procedures have been fixed.

Sources: Reuters, DSNews.com, The Wall Street Journal

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