Bank Foreclosure Suspension Reviews–Did Homeowners Unjustly Lose Their Homes?

Recently, two of the nation’s large mortgage servicers, Bank of America and GMAC Mortgage, stated that they would resume foreclosure practices after conducting reviews which had initially suspended foreclosures in various states across the country. While there were statements released that said no major flaws were found in the review of these foreclosure documents and that homes were rightly foreclosed upon, there are some who still remain doubtful.

There are reports that reviews are going to be conducted on the foreclosure practices implemented by many financial institutions which had originally called for suspensions earlier this month. Servicers like Bank of America, GMAC Mortgage, and J.P. Morgan Chase were accused of improperly processing documents which led to the foreclosure of numerous homes.

While, again, the consensus on this issue seems to state that foreclosures were warranted but documentation procedures may have been violated, thus homeowners who lost their home to foreclosure would have done so regardless of the documentation procedures which were improperly used.

Yet, some homeowners argue that banks which issued foreclosures on their home either didn’t own the property or these homeowners were not given a proper review which could have led to assistance plans, like those from home loan modifications, which could has helped certain homeowners avoid the loss of their home.

There are reports that indicate possible investigations into criminal activity may be likely since, in some cases, there is question over the intent of these foreclosure practices. While many believe that the financial institutions in question had employees who were simply overwhelmed with foreclosure paperwork and sought to quickly process foreclosures, there are reports that the FBI may investigate some of these foreclosure practices.

Various lawsuits and proposed meetings with governmental officials are planned, and the entire foreclosure process fiasco that has recently been experienced could take a substantial amount of time before it is fully resolved. However, financial institutions remain adamant that homeowners who were foreclosed on, in cases where documentation was questioned, had simply defaulted on their mortgage or were not in a position to benefit from assistance plans which may have helped them avoid the loss of their home.