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With U.S. foreclosure rates at an all-time high, more financial institutions are growing more cautious about closing the books on foreclosures. The latest lender to suspend foreclosures is GMAC (the mortgage unit for Ally Financial) — and it’s doing so in 23 states across the country.

But like any big bank deal that initially seems attractive to customers, there are some strings attached.

Like most banks and lenders, GMAC has been busy dealing with problem mortgages. The Treasury Department says that GMAC reported 16,570 home mortgages that were at least 60 days delinquent. The lender also has approved 29,000 permanent home modification deals since June.

While GMAC has declared a one-month moratorium on home foreclosures in 23 states (click here for a state-by-state list), the reasons for doing so may not be so altruistic.

The Wall Street Journal(Stock Quote: WSJ) is reporting that GMAC may be pulling back on foreclosures for legal reasons. Says the Journal: “The actions come one week after several Florida law firms representing lenders in GMAC-related foreclosures withdrew their cases against borrowers, an indication that they believe the foreclosures were mishandled by GMAC.”

But legal standards in many states require a witness to sign off on any foreclosure deal. The witness is usually an agent of the bank or lender, and has presumably reviewed the case and who ensures that the paperwork is lined up properly and that the lender does actually own the mortgage note attached to the foreclosed home.

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That’s where a potential problem pops up for GMAC. According to the Journal, a GMAC employee entrusted with the “witness” responsibilities told a Pennsylvania court recently that he had signed off on “hundreds” of foreclosures per day without actually reviewing the cases. On top of that admission, GMAC didn’t have a notary public on hand when the legal papers were signed — a standard practice for lenders closing out on a foreclosure.

Consequently, GMAC’s statement that it was reviewing its foreclosure procedures during the 30-day foreclosure suspension period takes on new meaning.

In the meantime, while GMAC lawyers sort everything out, homeowners in those 23 states who thought they would be handing over their keys and moving out now have a 30-day reprieve. But on the other end, buyers of those foreclosed homes how find themselves on the outside looking in, forced to accept their down payments back while GMAC resolves the issue.

Foreclosures aren’t easy for anyone. But for GMAC, things could get a lot more difficult before they get any easier.

And that’s likely the best-case scenario.

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