On May 6, 2013, there was yet another hiccup in the
foreclosure process. JP Morgan Chase, Citigroup,
and Wells Fargo halted
nearly all their foreclosures which were in their final
stage of losing their homes.
The sudden halt in activity was a result of bank
regulators continuing to make revisions to the treatment of distressed borrowers
in that final stage, the three powerhouse lenders decided that they needed to
do some internal exploration.
Bank of America surged forward claiming they have nothing
to fear. “We
manage our mortgage servicing operations in compliance with all laws,
regulations and standards for sound business practices,” said a spokesman for BofA mid-May of 2013.
the same case for the other three. Chase
had this to say;
response to the OCC guidance and in an abundance of caution, we temporarily
halted foreclosure sales where we could to validate that our process covered
the guidance. We have since resumed
to PropertyRadar.com, a foreclosure tracking firm on the
west coast, Wells and Citi were still at a standstill.
are in the process of complying and following the directive set forth in the OCC
guidance," Citigroup said.
latest OCC bulletin had "slight changes from the previous bulletin,” said
Wells Fargo, and “wanted to be absolutely sure that our interpretation of the
language was the same as our regulators.
We simply needed to take the time to assure that we can validate and
document our compliance."
‘hiccup,’ directly related to the settlements with 13 lenders for wrongful foreclosures,
and the delayed distribution of those funds to borrowers. Additionally, the OCC singled out some
issues and implemented new “minimum guidelines,” addressing many shortcuts,
errors and even robo-signing.
this period of “hiatus,” PropertyRadar reported that in a 2 week period across
the 5 west coast states of California, Oregon, Washington, Nevada and Arizona,
Wells Fargo went from 298 foreclosure sales the first week, to the following
week, 17 sales.
De Los Monteros of Cherry Picker Investments, an auction buying service in Chicago
says, “I’ve noticed the decreased activity in the foreclosure auctions. Just like the moratorium a while back, a halt
at all, however short it may be causes a chain reaction of backed up files,
especially in a judicial state like Illinois.
What does all this mean? It means
there will likely be a sudden resurge of properties in the Chicago metro area
auctions, much like earlier this year when Judicial Sales Corporation did more
than 3,000 properties in 1 month.”