Foreclosures bungle could hit US banks
NEW YORK (AFP) – Already fragile US financial firms are facing a raft of law suits and potential fines after three major mortgage lenders admitted to mishandling thousands of home foreclosures.
Major mortgage lenders Bank of American, JPMorgan Chase and GMAC have in recent days announced they were suspending tens of thousands of foreclosure processes across the country due to apparent improper handling of documents.
Attorney generals in six states are already investigating claims by borrowers that lenders have committed errors in the foreclosure documentations.
Foreclosures have evolved into a massive industry since the start of the economic crunch as Americans faced massive debts, with the number of mortgage defaults soaring from an annual average of one percent before 2008 to 10 percent today.
Lenders told to review foreclosure procedures
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