White House supports state probe of mortgage industry
The White House supports a proposed state investigation into the mortgage-servicing industry over foreclosure proceedings but is against a moratorium on foreclosures, White House Press Secretary Robert Gibbs said Tuesday. Gibbs said the White House supports getting to the bottom of problems in the foreclosure process but is wary of "unintended consequences to a broader moratorium." Such a ban on foreclosure proceedings could threaten the housing recovery, Gibbs said. As many as 40 states attorneys general are expected to announce a probe into the mortgage-service industry Wednesday, The Wall Street Journal reported Monday. Mortgage servicers, which includes units of major banks such as Bank of America Corp. (BAC), have faced allegations that they submitted fraudulent documents in foreclosure proceedings.