Even as August saw more Americans lose their homes to foreclosure than in any other month on record, there are growing concerns over the legality of many of those proceedings.
JPMorgan Chase has suspended legal proceedings on 50,000 foreclosures, due to concerns about the validity of the foreclosure documents, a spokesman for the bank told CNBC Wednesday (hat tip to Zero Hedge).
JPMorgan spokesman Tom Kelly confirmed to the AP Wednesday that “employees signed some affidavits about loan documents without personally verifying the files.”
The decision is the latest signal of a potentially massive stall in the nation's foreclosure process. Last week, after GMAC Mortgage halted its foreclosures in 23 states, the Washington Post reported that one of GMAC's employees hadn't read the roughly 10,000 foreclosure documents he approved each month (and now Colorado wants to be added to that list of states). It then turned out that the “robo signer” might not have been alone.
Phi Beta Iota: We called for a freeze on all foreclosures and evictions back in October 2008, instead of bailing out Wall Street where one $10 million bonus could cover an astonishing number of mortgage payments among the poor and lower middle class. The US Government failed to assure justice for all those who have been evicted to date. This move by JP Morgan is a good one, and also reminds us once again how important INTEGRITY is at every stage of every process. The reality is that most final “holders” of aggregated mortgages never had the actual loan note to begin with. The Department of Justice should have known that and should have advised all relevant policymakers and politicians of this fact, but in the rush to bail out Wall Street, the public interest was ignored, demeaned, and betrayed.