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More States Push Foreclosure Freeze

NEW YORK (TheStreet) -- Three more states have joined the bandwagon in looking to curtail what seems to be a growing problem with banks' foreclosure processes.

Massachusetts Attorney General Martha Coakley has called for a moratorium on foreclosures in the state in a letter to four of the largest mortgage servicers, JPMorgan Chase (JPM), Wells Fargo (WFC), Bank of America (BAC) and GMAC Mortgage, a unit of Ally Financial, according to The Boston Globe.

Coakley asked the banks to suspend foreclosures as well as sales of foreclosed properties as more banks get pulled into the latest scandal involving the housing industry - that many lenders have been signing off on foreclosures without reviewing and verifying necessary documents, something that is defined as "robo-signing," the article says.

Separately, North Carolina's Attorney General Roy Cooper is asking 14 lenders in his state to suspend foreclosures in order to prove that processes comply with the law, the Charlotte Observer says.

Cooper's office was one of several attorney generals, including Colorado and California, according to Bloomberg, that asked Ally Financial last week to provide more information involving the halting of foreclosures by its GMAC Mortgage arm in 23 states.

Bank of America and JPMorgan Chase have said they were halting some foreclosures as they look into the issue.

Delaware's Attorney General Beau Biden has also sent letters to BofA, Chase and Ally, asking that foreclosures be halted in his state until the policies are reviewed, according to the Associated Press.

Officials in Ohio, Connecticut, Florida, Texas, Iowa, Illinois and Maryland are also looking into home foreclosure abuses in their respective states, media reports say.

--Written by Laurie Kulikowski in New York.



To contact the writer of this article, click here: Laurie Kulikowski.

To submit a news tip, send an email to: tips@thestreet.com.

Stock quotes in this article: JPM, BAC, WFC 
Disclosure: TheStreet's editorial policy prohibits staff editors, reporters and analysts from holding positions in any individual stocks.

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