From the Star Ledger:
New Jersey’s highest court has stepped in to monitor the filing of real estate foreclosures in the state.
Supreme Court Chief Justice Stuart Rabner today announced that six lenders suspected of irregularities will have to present a case in court next month or face having their foreclosure actions suspended.
Rabner writes that the court “has become increasingly concerned about the accuracy and reliability of documents submitted to the Office of Foreclosure.”
A special master could be appointed to review the foreclosure practices of companies including Wells Fargo, JP Morgan Chase and Citibank.
From the WSJ:
New Jersey courts are threatening to block six major lenders from foreclosing on most homeowners unless they can prove their process is sound.
In response to errors blamed on so-called “robo-signers” and other potential shortcuts, judges on Monday ordered six lenders to defend their foreclosure practices and 24 others to produce reports on their process.
“It’s important that the judiciary ensures that judges are not rubber-stamping questionable documents that may not be reliable,” Supreme Court Chief Justice Stuart Rabner said. “The steps we’ve taken today are designed to ensure the integrity of that judicial process.”
New Jersey will also require banks’ attorneys to certify they spoke with a bank employee who reviewed the foreclosure documents, a practice similar to one enacted in October by New York. For now, foreclosures will continue, but Mr. Rabner said he didn’t expect a rush to push cases through in the meantime. The orders pertains to uncontested cases, or 94% of foreclosures in New Jersey.
The six banks—Ally Financial, Bank of America, Citibank, JP Morgan Chase, OneWest Bank FSB and Wells Fargo—were involved in 29,000 of the 65,000 foreclosure filings in New Jersey in 2010, Mr. Rabner said.
From the NY Times:
Six lenders that together have filed nearly 30,000 foreclosure actions in New Jersey this year face the possible suspension of such operations next month. The possible suspension came under a court order announced on Monday by the chief justice of the state Supreme Court, Stuart J. Rabner.
The action follows a report submitted to the Supreme Court that, citing depositions and court filings in other states, paints a picture of systemic abuses in the filing of foreclosures that include so-called robo-signing, in which employees signed hundreds of documents without checking them for accuracy.