JPMorgan Suspends Foreclosures over ‘Robo-Signing’ Controversy
Published on FierceFinance (http://www.fiercefinance.com)
For mortgage servicers, the recent moves by GMAC Mortgage and JPMorgan Chase to suspend foreclosures is nothing short of a nightmare. Lawyers for aggrieved mortgage holders have thrown a huge wrench into the market with revelations of so-called robo-signers who sign documents en masse, without personally reviewing the documents they are supposedly attesting to.
A deposed Chase employee said she and her team signed off on about 18,000 foreclosure documents a month without reviewing the loan files, reports MarketWatch. Up to 56,000 cases are affected.
At GMAC, a professional signer said he signed up to 500 foreclosure affidavits a day without reviewing files or having his signatures notarized, MarketWatch notes.
This has exploded into a huge control and compliance issue that may expand to other mortgage servicers, while presenting something of a gift to affected homeowners. Lawyers would like to pain this as an issue of servicers not knowing who holds the note. But in the case of JPMorgan, signers say they relied on the work of others in the firm. That may not prove to be enough, however.
The servicers have seen enough to know that suspending foreclosures is the safest move right now. State AGs are taking a close look at the situation. It’s all complicated by the fact that the U.S. is a big owner of GMAC.
- here’s a MarketWatch article