California Democrats call for investigation into loan modification and foreclosure practices

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http://latimesblogs.latimes.com/money_co/2010/10/california-democrats-call-for-investigation-into-foreclosure-practices.html

California’s Democratic congressional delegation has joined the call for investigations into delays and possible irregularities in the loan modification and foreclosure process.

In a letter Wednesday signed by the California representatives and Speaker of the House Nancy Pelosi, the delegation said that constituents who have requested loan modifications or a forbearance of foreclosure have reported lenders "routinely fail to respond in a timely manner, misplace requested documents, and send mixed signals about the requirements that need to be met to avoid foreclosures.”
(http://lofgren.house.gov/images/stories/pdf/letter_to_investigate_banks_-_final_10.4.10.pdf)

The letter -- which was addressed to U.S. Atty. Gen. Eric Holder, Federal Reserve Chairman Ben S. Bernanke and John Walsh, acting comptroller for the Office of the Comptroller of the Currency at the Treasury Department -- asks the agencies to "investigate possible violations of law."

The action follows several recent announcements by some of the nation’s biggest lenders that they were halting evictions and some foreclosure proceedings due to possible mistakes in their processes. But these freezes are taking place outside of California in so-called judicial foreclosure states, where courts have jurisdiction over the process.



Pelosi Calls For Investigation Of Foreclosure Fraud
http://www.huffingtonpost.com/2010/10/05/democrats-call-for-invest_n_751373.html

[EFerrari]

1. K&R

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2. Justice to investigate foreclosure practices after call by Pelosi

http://thehill.com/blogs/on-the-money/banking-financial-institutions/122997-justice-investigating-foreclosure-problems-at-banks

The Justice Department will look into the foreclosure practices of financial institutions for possible violations.

Attorney General Eric Holder announced the probe at a Wednesday press conference. The announcement follows a letter from House Speaker Nancy Pelosi (D-Calif.) and 30 other California House Democrats calling for an investigation.

"We are aware of the charges that have surfaced in the newspapers in the last couple of days, and we're looking at them," Holder told reporters Wednesday.

Pelosi and the other lawmakers have charged that homeowners have been unable to obtain help such as loan modifications because banks never responded, lost paperwork and didn't provide straightforward information on what they needed to do to avoid foreclosure.