Top US government lawyers in all 50 states and the District of Colombia on Wednesday unveiled a joint investigation into banks and mortgage companies who repossessed homes in the wake of the financial crisis.
The attorneys general from across the US are investigating “procedural defects” in foreclosure proceedings, a move that could spell chaos for the already battered real estate market.
In the wake of the financial crisis and amid a deluge of hundreds of thousands of foreclosures, lenders are accused of processing paperwork as quickly as possible in the hope of getting properties back on the market.
Some of the largest US lenders have since suspended foreclosures after it emerged that thousands of documents may have been signed without review or a notary present, a practice now known as “robo-signing.”
“This is not simply about a glitch in paperwork,’’ Iowa Attorney General Tom Miller, who’s leading the probe, said in a statement. “It’s also about some companies violating the law and many people losing their homes.’’
“We believe such a process may constitute a deceptive act and/or an unfair practice or otherwise violate state laws,” the officials said in a joint statement.
More than 100,000 US homes were seized by lenders last month, a record number that probably will decline as major banks halt repossessions and begin to review their foreclosure practices.
Lenders took over 102,134 properties last month, RealtyTrac Inc said in a report yesterday. That was the highest monthly tally since the company began tracking the data in 2005, surpassing the August record of 95,364.
Foreclosure filings, including default and auction notices, rose 3 percent from the prior month to 347,420. One out of every 371 households received a notice.
Sales of properties in the foreclosure process accounted for almost a third of all US transactions in the month, a sign that a prolonged delay in repossessions might hurt the housing market, RealtyTrac said.
Bank of America, JPMorgan Chase and GMAC are among those lenders who have suspended foreclosures. If found guilty, the firms could face a raft of lawsuits and fines that experts believe could total billions of dollars.
Foreclosure filings totaled 930,437 in the third quarter, a 4 percent rise from the second quarter and a 1 percent decline from the same period of last year, RealtyTrac said. Lenders seized a record 288,345 properties in the period, up 22 percent from a year earlier.
“We expect to see a dip in those bank repossessions — and possibly earlier stages of the foreclosure process — in the fourth quarter,” RealtyTrac chief executive officer James Saccacio said in the report.
Foreclosures have evolved into a vast industry since the start of the financial crisis that left millions of Americans with housing debt well above the value of their homes and without a job that would help repay loans.
The number of mortgage defaults has soared from an annual average of 1 percent before 2008 to 10 percent today. More than 3 million foreclosures were expected to take place in the US this year, figures show and documentation problems might exist in as many as 80 percent of them, according to some observers.
US President Barack Obama has rejected calls for a nationwide foreclosure moratorium.
Taiwan Transport and Storage Corp (TTS, 台灣通運倉儲) yesterday unveiled its first electric tractor unit — manufactured by Volvo Trucks — in a ceremony in Taipei, and said the unit would soon be used to transport cement produced by Taiwan Cement Corp (TCC, 台灣水泥). Both TTS and TCC belong to TCC International Holdings Ltd (台泥國際集團). With the electric tractor unit, the Taipei-based cement firm would become the first in Taiwan to use electric vehicles to transport construction materials. TTS chairman Koo Kung-yi (辜公怡), Volvo Trucks vice president of sales and marketing Johan Selven, TCC president Roman Cheng (程耀輝) and Taikoo Motors Group
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