B of A Expands Foreclosure Freeze to All 50 States

Bank of America Corp. is halting foreclosure sales in all 50 states as it extends its review of foreclosure documents.

The Charlotte banking company said Friday that it will hold off on any sales "until our assessment has been satisfactorily completed. Our ongoing assessment shows the basis for our past foreclosure decisions is accurate."

B of A had halted foreclosures in the 23 states where they are handled by courts last week, following similar moves by Ally Financial Inc.’s GMAC Mortgage and JPMorgan Chase & Co. The servicer is the first to extend the moratorium to all 50 states.

The companies said they were slowing foreclosures after discovering problems in the way affidavits and other court documents were executed. The issue was brought to light in depositions of employees, who revealed that they routinely signed thousands of documents a month without verifying the information or having a witness present, which is required by law.

The New York Times reported Thursday that PNC Financial Services Group Inc. had also suspended foreclosure sales, citing a title insurer that had received a memo from the Pittsburgh bank. PNC spokesman Fred Solomon told American Banker that the bank had begun a review of its mortgage servicing procedures, but would not comment beyond that.

Several attorneys general have opened investigations into the matter. On Wednesday, Ohio's attorney general filed a civil fraud suit against GMAC Mortgage.

U.S. Attorney General Eric Holder has been reported as saying the Department of Justice is looking into the matter.

Officials in states where foreclosures are handled outside of court, including Texas and California, have also gotten into the fray, seeking a freeze on foreclosures and an investigation into the practices.