Bank of America HALTS Foreclosures Across Country

In a move that came as a surprise to many, Bank of American announced today that it was halting foreclosures nationwide, while it investigates its policies.

Within the last few weeks B of A and other lending institutions had made public that they were thinking of investigating foreclosure protocol in states that are judicial foreclosure states. This means a state that requires the lender go through the judicial system in order to obtain foreclosures. Recently many disgruntled homeowners had been seeking advice of attorneys and had been going after lenders, requiring them to “produce the note” proving that the lender was in fact the property owner. Most times the note was produced but the tactic helped stall the foreclosure process. In rare cases the lenders were unable to produce the note.

Lenders sometimes do not hold the actual note, as loans may have been sold numerous times over the life of the loan, oftentimes creating situations where the current lender may not have the actual piece of paper proving ownership.

The announcement today was surprising, as B of A is now halting foreclosures in non-judicial states, like California. Earlier this month the lending giant announced that it was imposing a moratoria in 23 judicial foreclosure states, to which other lenders followed suit. Officials with the lender claim they want to make sure they are following proper procedures in all foreclosure cases.

Bank of America will still proceed with the foreclosure process on delinquent borrowers, but will not issue foreclosure judgments and sales scheduled for Saturday and beyond. Those troubled homeowners will likely not escape the foreclosure process due to this halt, but will gain more time to hopefully find ways to solve their delinquency problems.

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