Ohio Attorney General Richard Cordray is warning mortgage servicers not to rush foreclosure fixes in the wake of the recent robo-signing scandal. The AG also said that Wells Fargo can’t simply fix false testimony by submitting new affidavits — intentions the bank announced last week. “The suggestion by Wells Fargo and its colleagues at several other national firms that they can cure fraudulent testimony by simply refiling new affidavits and continuing to proceed toward foreclosures shows that they simply don’t recognize the seriousness of the problem,” Cordray said. Wells Fargo said in statement about the affidavit substitution that “out of abundance of caution and to provide an additional level of assurance regarding its processes, the company is electing to submit supplemental affidavits for approximately 55,000 foreclosures which are pending before courts in 23 judicial foreclosure states.” Supplemental affidavits isn’t sufficient in Cordray’s mind. “We have asked both Wells Fargo and Ally to vacate any judgment and withdraw any motion that resulted in a judgment in which in which an improper affidavit was submitted — and that they not proceed to foreclosure sale on any property or evict any homeowner in any case where fraudulent evidence was submitted to the court,” Cordray’s office responded, when asked what action they thought lenders should take. “I don’t think anyone can really defend a foreclosure notice based on fraudulent evidence,” he said. The Ohio AG was the first to go after Ally Financial in the courts, early last month, and was profiled in the March 2010 issue of HousingWire after he brought lawsuits against the three largest credit rating agencies alleging misconduct in the mortgage finance space. “We may have to sue others,” he said in the March profile. And now that he has, other state attorneys generals are also investigating. Along with Ally, several major lenders, including Bank of America (BAC), JPMorgan (JPM) and Wells Fargo (WFC) are under fire for admitting employees signed affidavits without properly reviewing the documents. Two weeks ago, attorneys general for all 50 states announced a coalition to investigate lenders that filed faulty foreclosure affidavits. And this week, Wells Fargo, who has maintained all its documents were accurate, announced that it will submit 55,000 supplemental affidavits for pending foreclosures in judicial review states. James Olecki, spokesman for Ally Financial, responded to the allegations after the Cordray’s lawsuit was filed, saying, “There was nothing fraudulent or deceitful about GMAC Mortgage’s practices. If procedural mistakes were made in the completion of certain legal documents, GMAC Mortgage reacted proactively to the situation and immediately undertook to remedy the situation.” The lawsuit filed by Cordray’s office alleges the company and its agents violated the state’s consumer protection laws by filing fraudulent foreclosure affidavits in hundreds of Ohio cases. Banks still think they don’t have to play by the same rules as everyone else, Cordray said. “Wishing the problem away; that’s unrealistic,” he said. Sarah Mueller is an editorial assistant at HousingWire.
Most Popular Articles
Low rates are making this summer one for the record books. Accordingly, loan officers, underwriters, real estate agents and those working in title and settlement offices are continuing to work the long hours that have become the norm since March. Not that they’re complaining.
Tappable home equity, meaning the equity homeowners could borrow against, rose to a record $6.5 trillion in the first quarter, Black Knight said in a Monday report.