Two U.S. banks suspend foreclosures

Feb. 13, 2009 at 12:53 PM
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WASHINGTON, Feb. 13 (UPI) -- Two U.S. banks said they would freeze foreclosures activity temporarily while the government works on a homeowner bailout plan.

In a letter to U.S. Rep. Barney Frank, D-Mass., chairman of the House of Representatives Financial Services Committee, J.P. Morgan Chase Chief Executive Officer Jamie Dimon said the bank would suspend foreclosures through March 6, The Wall Street Journal reported Friday.

"We believe three weeks is adequate time for the Treasury to announce -- and for us to implement -- a new plan," Dimon said.

Citigroup announced it would hold off on foreclosures until March 12 for all its first mortgage loans that are owner-occupied and on loans in which the move is agreeable to investors, the newspaper said.

Citigroup said it would cancel the moratorium if the government approves of a loan-modification plan earlier than March 12.

In a recent congressional hearing, lawmakers asked banking executives to enact foreclosure moratoriums to help stabilize the housing industry. Treasury Secretary Tim Geithner has said he is working on a plan to help homeowners remain in their homes.

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