Delaware AG Beau Biden’s office asks 3 banks to temporarily halt foreclosures pending review

By Kathleen Miller, AP
Wednesday, October 6, 2010

AG Biden asks 3 banks to freeze foreclosures

WASHINGTON — Delaware Attorney General Beau Biden’s office sent letters Tuesday asking three mortgage lenders to suspend all pending foreclosures until the banks can review their policies.

The letter also asks Bank of America Corp., JP Morgan Chase & Co. and Ally Financial Inc. officials to describe their foreclosure review and verification process, and provide copies of Delaware homeowner complaints about the foreclosure process, including concerns about court documents that contained inaccurate information, improper notarization or signatures to Biden’s fraud and consumer protection division.

A Biden spokesman told The Associated Press on Monday that his office would request mortgage banks temporarily suspend foreclosure proceedings, but he clarified Tuesday that only three lenders would be asked.

The targeted lenders have halted tens of thousands of foreclosure cases elsewhere due to document verification issues.

In the letter, Biden’s staff asks the companies to explain how they ensure that the information presented to the Delaware Courts is “complete and accurate” and provide a detailed description of why the bank has suspended foreclosures in other states. The Attorney General’s office directs the lenders to return the requested information by Oct. 18.

Tom Kelly, a spokesman for JP Morgan, declined to comment.

Gina Proia, a spokeswoman for Ally Financial, declined to comment specifically on Delaware’s request. Proia referred to a previous company statement that says bank officials are confident they have not inappropriately foreclosed on any borrowers and they are acting with urgency to resolve problematic issues in some places. The statement says a procedural error was found on some affidavits required in certain states.

Bank of America spokespeople did not immediately respond to a request for comment.

Other states are taking similar action. In neighboring Maryland, Gov. Martin O’Malley, Attorney General Doug Gansler and Rep. Elijah Cummings sent a joint letter Monday to seven mortgage lenders, including three of the firms targeted by Biden’s office in Delaware, asking them to similarly suspend foreclosure proceedings and review their procedures to make sure foreclosures in Maryland were done properly. In Texas, Attorney General Greg Abbott asked 27 loan servicing companies on Monday to suspend all foreclosure activities over concerns about the accuracy of foreclosure documents.

will not be displayed