PNC Bank plans to resume mortgage foreclosures with “enhanced procedures,” according to a regulatory filing by the bank.
The quarterly filing to the Securities and Exchange Commission outlined the problems the foreclosure industry has faced and announced that PNC’s foreclosure system is “designed to ensure that no foreclosure proceeds unless the loan is genuinely in default.” The bank noted that most of the foreclosures it performed were on properties in default for longer than one year and that the bank held a foreclosure market share of less than 2%. PNC originally put a halt to foreclosure filings early last month.
The bank is still evaluating foreclosures that were in the filing process when the foreclosure freeze hit, but it is proceeding with new foreclosure seizures. Attorneys general in all 50 states are currently participating in a joint investigation of banks’ foreclosure practices.
“We are currently proceeding with new foreclosures under enhanced procedures designed as part of this review to minimize the risk of errors related to the processing of documentation in foreclosure cases,” PNC said in a statement.
Foreclosure Crisis Recap
The foreclosure freezes first started in late September when Ally GMAC’s mortgage division stopped foreclosures in 23 states to investigate whether its employees were taking all the proper steps before making home seizures. More specifically, lawyers had uncovered potentially fraudulent measures being taken by the bank. Employees known as “robo-signers” were signing off and filing thousands of pages of paperwork they most likely never took the time to read. Banks probably resorted to robo-signing in an effort to get out from under huge backlogs of foreclosures that stacked up due to a high volume of defaults after the mortgage meltdown and financial crisis.
Ally was just the first domino to fall. Ten days later, Chase Bank stopped foreclosures in the same 23 states to investigate the same potential problems. A few days after that Bank of America® halted foreclosures in those 23 states. PNC Bank followed suit later that week on the same day Bank of America® curtailed foreclosures across the rest of the nation. The federal government does not support the idea of a nationwide foreclosure moratorium, but attorneys general in 50 states are taking part in a joint investigation of foreclosure practices.