Various developments have occurred this week relating to the heightened concern over defective foreclosure processes and the moratoriums on foreclosure proceedings instituted by certain financial services companies, including Bank of America and GMAC, a subsidiary of Ally Financial.
Yesterday, Bank of America, which announced a nationwide delay in foreclosure proceedings less than two weeks ago, announced that it had reviewed its process for resubmission of foreclosure affidavits in the 23 states that require judicial proceedings for foreclosures, and that it will resume approximately 102,000 foreclosure proceedings in those states on or about October 25. Bank of America said it will continue to delay foreclosure sales in the remaining 27 states until its review is complete on a state-by-state basis.
Separately, it has widely been reported that the Ally Financial unit, GMAC Mortgage, will resume foreclosure proceedings, after announcing last week that it had engaged several legal and accounting firms to conduct independent reviews of its foreclosure procedures in all 50 states.
Also, executives at other financial services companies are reportedly discussing foreclosure-related issues on their earnings calls. Yesterday, Citigroup CEO Vikram Pandit stated that Citigroup continuously reviews its “document handling procedures and believe[s] the integrity of Citi’s foreclosure process is sound,” and that they have not identified any systemic issues related to foreclosure documentation. During Goldman Sachs' earnings call earlier today, CFO David Viniar maintained that Goldman’s exposure in the mortgage servicing business was not very large, and that its Litton Loan Servicing unit had conducted a broad review of mortgage foreclosures and concluded the underlying foreclosures were warranted.