ING DIRECT Suspends Foreclosures

Wilmington, Del.-based ING DIRECT, the nation’s largest direct bank, said Monday morning that effective immediately, it will suspend foreclosure sales on occupied single-family properties through the end of March 2009. The company also said it would suspend all evictions on occupied single-family properties through Jan. 15, 2009, “in the spirit of the holidays,” according to a press statement released by the firm. The eviction freeze formalizes a previously informal, internal process, ING officials said. Eviction freezes are relatively common at most lenders, although many previously weren’t publicized; although ING’s eviction freeze is clearly much longer than similar freezes at other lenders. “As a responsible lender, ING DIRECT keeps the mortgages we originate; we do not sell them to Wall Street,” said Arkadi Kuhlmann, ING DIRECT CEO. “We help customers buy homes with mortgages only if we believe they are suitable and affordable. Consequently, once we get customers into a home, we work hard to help them stay there. We hope this foreclosure suspension will provide some relief during the holidays to those experiencing financial hardships.” What ING didn’t disclose was the number of borrowers likely to be impacted by its policies; we’ve heard that credit risk on ING’s portfolio is well-managed, meaning that the number of defaults remains very low. But the bank nonetheless joins a growing list of financial firms instituting a “national foreclosure time-out” for the rest of this year; last week, both Fannie Mae (FNM) and Freddie Mac (FRE) announced a similar freeze on foreclosures and evictions. Write to Paul Jackson at [email protected]. Disclosure: The author held no relevant investment positions when this story was published. Indirect holdings may exist via mutual fund investments. HW reporters and writers follow a strict disclosure policy, the first in the mortgage trade.