Bank of America has announced that their foreclosure process will begin again, and that they intend to do a better job of documentation in the future. Problems with document verification and issues with foreclosures of properties in error had caused B of A to halt foreclosures while they examined their procedures.
- In one case, the bank shut off the utilities of a Pittsburgh homeowner and seized her pet parrot. The only problem was the she was not late on her payments.
- In another case, B of A foreclosed on a home that had no mortgage, purchased with cash by the owner.
Stories like these have caused increased scrutiny of foreclosures in bankruptcy courts around the country, and by judges who previously ruled on foreclosure actions with little or no check of the facts. Bank of America has stated that no foreclosure action will be taken in the future until the homeowner has been given an opportunity to be evaluated for a mortgage modification, or allowed to attempt a short sale or provide their deed in lieu of foreclosure. The bank states that foreclosure will be the "option of last resort."
B of A states that more than 86% of their mortgages are current, but they will proceed with foreclose on 16,000 homes this month. They will however suspend sales and evictions over the holidays. Their records also show that at the time of foreclosure sale, one-third of the properties are vacant.