Bank of America is the first bank to stop tens of thousands of foreclosed homes in all 50 states. This decision was made in reaction to pressure from public officials inquiring about the accuracy of foreclosure documents. A company spokesman insists that past foreclosures are accurate. Banking and housing analysts, however, "fear the foreclosure document problems could prolong the housing bust, and hundreds of thousands of inevitable foreclosures will be pushed off into some legal limbo for years."
"If you are looking at the key in this country to economic stability, it's the housing industry," said banking analyst Nancy Bush of NAB Research. "This is a huge mess that helps nothing."
According to a document obtained by the Associate Press, a banking official admitted to signing thousands of foreclosure statements a month without reading many of them.
Senate Majority Leader Harry Reid, D-Nev encouraged banks in Nevada to suspend foreclosures until they are sure homes are not wrongly assigned to foreclosure status.
PNC also announced that it is halting foreclosures and evictions in 23 states so it can review all documents to ensure they were properly completed. PNC is the fourth bank to halt some foreclosures due to evidence that lawyers and employees signed documents without verifying them.
I am shocked by this announcement. Our economy is already in so much trouble and this situation can only prolong the housing crisis we are facing. The irresponsibility of banks got us into the mess and the continued irresponsibility will keep us here.
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