Bank of America Extends Foreclosure Moratorium to All 50 States
Updated: Bank of America is stopping foreclosures in all 50 states, making it the first bank to call a nationwide halt to foreclosures amid questions about flawed documents.
The halt expands the bank’s previous moratorium on foreclosures in 23 states where courts have to participate in foreclosure proceedings, according the Washington Post. JPMorgan Chase and Ally Financial, previously known as GMAC, have also previously announced a stop to foreclosures in 23 states, Reuters says.
A Bank of America statement says foreclosures will be stopped until the bank completes a review of foreclosure documents. Senate Majority Leader Harry Reid, D-Nev., praised Bank of America’s decision and called on major lenders to follow its lead.
Meanwhile a fourth lender, PNC Financial Services, announced today that it is stopping foreclosures in 23 states for a month while it completes a document review, the Associated Press reports.
Bank of America’s new announcement is likely to cause turmoil for buyers of foreclosed properties such as Amanda Ducksworth, who was supposed to move in to a new three-bedroom home in Ocala, Fla., this week. Now the home has been pulled from the market and Duscksworth and her son are staying at her boss’s home.
The New York Times profiled Ducksworth in a story written before today’s announcements by PNC and Bank of America. The story said foreclosure moratoriums are throwing into limbo possibly hundreds of thousands of foreclosures and pending home sales.
“I gave up my rental thinking I would have a house,” Ducksworth told the Times. “Now I’m sharing a room with my son. What the hell is up with that?”
Updated at 12:56 p.m to include statement from Senate Majority Leader Harry Reid.