Federal Bank Regulators Scrutinizing Mortgage Lawsuits Against Banks, Opening New Worry For Investors, Bankers
Shahien Nasiripour
HuffPost
First Posted: 07/6/11
WASHINGTON -- Federal bank regulators are scrutinizing more than 150 home loan-related lawsuits directed at lenders and mortgage companies, a top official at the Federal Deposit Insurance Corporation plans to say Thursday, underscoring the threat the largest U.S. banks face from faulty and improper mortgage and foreclosure practices.
The revelation will likely add to large banks' woes, as the five biggest servicers -- Bank of America, JPMorgan Chase, Wells Fargo, Citigroup and Ally Financial -- currently face up to $30 billion in penalties from state attorneys general and federal agencies for wrongful foreclosures and other mortgage-related misdeeds.
Lenders and servicers, which collect borrowers' monthly payments and foreclose on them when they fall behind, face 67 pending class-action suits in more than 20 states that challenge foreclosures based on so-called "robo-signing" and other poor documentation practices, according to FDIC Director of Depositor and Consumer Protection Mark Pearce's prepared remarks for a Thursday congressional panel.
(Original here.)
HuffPost
First Posted: 07/6/11
WASHINGTON -- Federal bank regulators are scrutinizing more than 150 home loan-related lawsuits directed at lenders and mortgage companies, a top official at the Federal Deposit Insurance Corporation plans to say Thursday, underscoring the threat the largest U.S. banks face from faulty and improper mortgage and foreclosure practices.
The revelation will likely add to large banks' woes, as the five biggest servicers -- Bank of America, JPMorgan Chase, Wells Fargo, Citigroup and Ally Financial -- currently face up to $30 billion in penalties from state attorneys general and federal agencies for wrongful foreclosures and other mortgage-related misdeeds.
Lenders and servicers, which collect borrowers' monthly payments and foreclose on them when they fall behind, face 67 pending class-action suits in more than 20 states that challenge foreclosures based on so-called "robo-signing" and other poor documentation practices, according to FDIC Director of Depositor and Consumer Protection Mark Pearce's prepared remarks for a Thursday congressional panel.
(Original here.)
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