Bank of America Finds Foreclosure Document Errors

A couple of months ago, it at discovered that “many banks used "robo-signers" to approve large numbers of foreclosure documents without reading them closely” (WSJ). Two of such banks are Bank of America and Wells Fargo & Co. Which are currently been scrutinized by the federal government regarding their handling of foreclosures. The problem here is that banks were evading their responsibility of overseeing the transactions of the foreclosures. It became more profitable to make a thousand foreclosures wrong than a few right.

The worst thing is that both banks were shameless about the matter and did not take responsibility for their actions. “Bank of America in several recent public comments about the foreclosure issue did not acknowledge even minor errors” (WSJ). “Wells Fargo & Co. Chief Executive John Stumpf on Oct. 20 said: "I don't know how other companies do it, but in our company the affidavit signer and the reviewer are the same team member."” (WSJ). It is not but recently, and only under the scrutiny of the government, that both corporations have either admitted wrong doings or have gotten caught on the act. The Wall Street Journal reads: “Bank of America Corp. for the first time acknowledged finding some mistakes in foreclosure files as it begins to resubmit documents in 102,000 cases” (WSJ). The article continues “Days later a deposition emerged from a bankruptcy case indicating that Wells Fargo had in fact used a robo-signer who didn't verify documents she approved” (WSJ). This keeping in mind that this are the nation's largest mortgage lenders.

Within the mistakes found on the contracts range the following errors:

• address missing one of five digits
• misspellings of borrowers' names
• transposition of a first and last name
• missing signature

So what does this mean, which is the bottom line? Two things. First, Bank of America and Wells Fargo, which are big players on the consumer banking industry, have lost their credibility as overseers of foreclosures. And second,both corporations will probably have a harder time dealing with great volume of foreclosures because of the government oversight. Both things will affect both corporations’ bottom lines negatively in the short and long run.


Source:

http://online.wsj.com/article/SB10001424052702303864404575572662815011760.html#articleTabs%3Darticle