Alabama Attorney General Luther Strange is among a small group of state Attorneys General who say they opposed a proposed nationwide settlement with the nation’s largest mortgage servicers related to foreclosure abuses. The settlement, entered into by a coalition of Attorneys General and other governmental officials, would impose new regulations and fines against the servicers. Media reports indicated mortgage servicers could be required to pay at least $20 billion to U.S. homeowners who incurred losses from mishandled foreclosures or loans during the housing collapse.
Attorney General Strange, along with the Attorneys General of Oklahoma and Nebraska, wrote a letter in March raising concerns over the term sheet submitted to the largest U.S. mortgage servicers. The three Attorneys General said in their letter to Iowa Attorney General Tom Miller, who is leading negotiations for the states involved in the settlement:
What started out as an effort to correct specific practices harmful to consumers has morphed into an attempt to establish an overarching regulatory scheme that fundamentally restructures the mortgage loan industry in the United States.
In a separate letter to Attorney General Miller, Attorneys General for Virginia, Texas, Florida and South Carolina expressed similar concerns about the settlement. They said the settlement would conflict with state laws and go “beyond enforcement and into regulation.” Georgia’s Attorney General also has voiced disagreement. While the states have broken ranks in recent weeks, back in October all 50 states Attorneys General united to inquire whether mortgage servicers improperly handled foreclosure documents. Based on our firm’s involvement in civil litigation, I know for a fact that the wrongful handling of foreclosures has happened in great number.
Any mortgage servicer engaged in illegal or deceptive practices must be held accountable for their wrongdoing. But current Alabama law doesn’t provide adequate protection to consumers fighting wrongful foreclosure. Attorney General Miller’s office has accused Bank of America of engaging in a strategy to divide the 50 states in their support for the settlement.
In an action, separate from the Attorneys General settlement, several federal banking regulators recently announced formal enforcement actions against eight national mortgage servicers and two third-party service providers for “unsafe and unsound” practices. Those actions will require the mortgage servicers to improve residential mortgage loan servicing and foreclosure processing. It may also result in independent inquiries into previous foreclosure processing.
Contact us today for a free legal consultation with an experienced attorney.
Fields marked *may be required for submission.
If you would like to subscribe to the Jere Beasley Report digital edition, simply visit our Subscriptions page and provide the necessary information or call us at 800-898-2034.
Attorney Advertising - Prior results do not guarantee a similar outcome.