Bank Of America Announces Foreclosure Moratorium

October 08, 2010

MANCHESTER, N.H. -- The nation's largest bank is suspending foreclosure activities on homes in default, and U.S. Sen. Jeanne Shaheen, D-N.H., said she wants the moratorium extended to other major lenders.


In August, about 820 homes in New Hampshire were foreclosed upon. Bank of America had originally suspended foreclosure activity in states where foreclosures had to be approved by the courts, but the freeze was then extended to all 50 states.


Shaheen said she is pleased by the move but said it is only a start.


"I've joined several other senators in sending a letter to JP Morgan Chase and Allied Financial, who are the other two big banks holding mortgages in New Hampshire, to ask them to follow suit," Shaheen said.


In the wake of news that thousands of foreclosure documents may have been improperly processed at Bank of America, Shaheen said the volume of foreclosures around the county dictates that problems could have occurred in other lending institutions, and a broad moratorium would be the right thing to do.


"The foreclosure process has not really worked for people who are facing foreclosure," Shaheen said. "There hasn't been adequate scrutiny of the paperwork, and so many people who might have been able to get a modification have not been able to qualify for that."


Robert Tourigny of Neighborworks in Manchester called the moratorium a positive step, saying that while the banks get their house in order, it offers a golden opportunity for struggling homeowners to do the same.


"So, it's a good time to take advantage of foreclosure prevention counseling," he said. "Learn what their resources are, learn what the opportunities are and try to get their mortgage back on track before those foreclosures start up again."


There is no timetable for how long the moratorium will last or how long it will take banks to review their records. But the chief executive officer of Bank of America said Friday the freeze will likely last at least a few weeks.

Source: WMUR