Chase freezes 56K foreclosures

Sept. 29, 2010 at 9:49 PM
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NEW YORK, Sept. 29 (UPI) -- JPMorgan Chase Wednesday said it was freezing 56,000 U.S. foreclosures because some employees may have signed off on documents without sufficient review.

Spokesman Tom Kelly, said the company has asked courts to refrain from entering judgments in some pending cases while the company further examines filings "to verify that the affidavits and other documents meet the standard of personal knowledge or review where that is required," The Washington Post reported.

All of the affected filings are in the 23 states in which foreclosure requires court approval, The New York Times reported.

GMAC Mortgage, the nation's fourth-largest mortgage lender, informed brokers and real estate agents this month it was suspending foreclosures due to legal paperwork rushed through the court systems of several states as the U.S. housing market tanked. GMAC and Chase, in the interest of processing hundreds of thousands of foreclosures as quickly as possible, employed people who could sign documents so quickly they came to be known as "robo-signers," the Times said.

Affidavits in foreclosure cases attest preparers personally reviewed documentation and attorneys say homeowners are inappropriately foreclosed upon when documents are not properly reviewed.

Kelly said Chase does not expect to find "any factual problems and that customers have been harmed, but if we do find any cases we will take appropriate action," the Post reported.

A Chase employee said in a sworn deposition in May she and her team signed off on as many as 18,000 foreclosure affidavits and other documents each month without reviewing them sufficiently.

A Florida defense lawyer, Matthew Weidner, said the "fallout (from the affidavit disclosures) will burn through the entire mortgage servicing industry."

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