Bank of America Restarts their Foreclosure Processes

A week back, when majority of the banks announced that they would stop all foreclosure evictions during the holiday period, it was taken for granted that there would be no evictions even before the holiday period. However, there is bad news for some as Bank of America on Friday 10 December announced it had asked its attorneys to start sales on delinquent properties with immediate effect. The announcement was made by Bank of America spokesperson, Dan Frahm. Nevertheless, foreclosure sales will take place until 20 December and then will be resumed after 3 Jan 2011.

Bank of America had declared moratoriums across the country to review its paperwork. Three weeks later, the bank announced that they were going to re-file about 102,000 inappropriately processed cases. The bank initially started to re-file cases in 23 states, where a judicial procedure is mandatory to process a foreclosure, until last week when it lifted its ban on rest of the 27 states. As per the announcement on Friday, the bank is looking at closing about 16,000 houses by the end of this month. They will start with properties that are vacant or unoccupied by the owner. Among the 16,000 cases, 7,800 foreclosure properties come under states where judicial proceedings are required and majority of the cases are from Florida State.

Florida is one of the worst hit states by foreclosures. Amid 102,000 cases, 70 percent cases to be re-filed are in Florida. Other states that Bank of America will cover under the 16,000 houses to be evicted are Texas, California, Michigan, and Georgia. Reason Bank of America provided for restarting the processes is that they have almost finished reviewing all the cases and have revamped their internal processes as well.

President of Bank of America, Barbara Desoer confirmed on the foreclosure statement by saying, “We have identified areas of our processes that can be improved, and while we make these improvements, it’s important that we move ahead with efforts to reduce the number of abandoned properties across the country. These properties can drag down home values in neighborhoods and slow the eventual recovery of the housing market.”

In addition to that, Chief Executive of Bank of America, Brian Moynihan, stated that the bank would be moving up to 2500 employees to its mortgage units to help approximately 29,000 delinquent homeowners. The shift was made under the “homeownership retention initiatives”. It is important to implement such initiatives to curb foreclosure rate as 14 percent of Bank of America loans are under default.