Legal actions against Bank of America are piling up, this time from Attorneys General in Nevada and Arizona, housing bubble ground zero.
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(Bloomberg) - Bank of America Corp. was sued by Arizona and Nevada over home-loan modification programs intended to keep homeowners who borrowed from its Countrywide mortgage unit out of foreclosure.
Instead of working to modify loans on a timely basis, Bank of America proceeded with foreclosures while borrowers’ requests for modifications were pending, a violation of a 2009 agreement with Arizona to help borrowers facing the loss of their homes, Terry Goddard, the state’s attorney general, said yesterday in a statement.
“We are disappointed that the suit was filed at this time,” Dan Frahm, a Bank of America spokesman, said in an e-mail, referring to the Arizona suit. “We and other major servicers are currently engaged in multistate discussions led by Attorney General Miller in Iowa to try to address foreclosure related issues more comprehensively.”
All 50 U.S. states are investigating whether banks and loan servicers used false documents and signatures to justify hundreds of thousands of foreclosures. The probe, announced Oct. 13, came after JPMorgan Chase & Co. and Ally Financial Inc.’s GMAC mortgage unit said they would stop repossessions in 23 states where courts supervise home seizures, and Bank of America, the largest U.S. lender, froze foreclosures nationwide.
Misleading Consumers
The bank is accused in the Arizona and Nevada lawsuits filed yesterday of misleading consumers about requirements for the modification program and how long it would take for requests to be decided. The bank provided inaccurate and deceptive reasons for denying modification requests, according to the suits.
Continue reading at Bloomberg...
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