Today's Globe reports that Attorney General Martha Coakley is poised to file suit against Bank of America and other major mortgage lenders for irregularities in their foreclosure practices. The story specifically mentions a tendency to enter into mortgage modification agreements with financially distressed homeowners, but then to go ahead with foreclosure anyway in violation of the spirit if not the letter of the modification agreement.
For all the effort put into modifying mortgage to allow homeowners to remain in their residences, only a tiny fraction of homes have been saved. Clearly something is not working. Perhaps a suit like this would force some meaningful negotiations. The current system not only misleads the home owners in that position, it also causes continuous damage to the neighborhoods in which the foreclosures occur.
Tuesday, October 18, 2011
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