Two of the nation's largest banks say they will improve how they deal with homeowners after fielding hundreds of complaints over the $25 billion settlement aimed at curbing foreclosure abuse.
Bank of America and Wells Fargo have agreed to correct issues with some of the hundreds of new settlement standards, pledging stronger controls against foreclosure errors, speedier underwriting and clearer communication with borrowers who want to stay in their homes.
Florida Attorney General Pam Bondi announced the changes Wednesday and said they would ensure banks "do a better job of providing Florida's distressed homeowners the timely and effective assistance they need."
Among other changes, banks pledged they would give certain homeowners single points of contact; tell borrowers more quickly about missing documents; better explain why a loan modification was denied; and launch more reviews to prevent "dual tracking," in which lenders pursue foreclosure while also working on a loan modification.
In a letter Tuesday to Bondi's office from Bank of America senior vice president Anthony Meola, in which he begins "Dear General Bondi," the executive said the bank would better clarify its letters to homeowners, adding that the company "remains committed to improving the loss mitigation process for our borrowers."
The banks joined Ally Financial, Citigroup and JPMorgan Chase in agreeing last year to the National Mortgage Settlement, which resolved accusations against lenders of foreclosure abuse, including "robo-signing" documents to improperly speed up foreclosures.
Banks say they have given Floridians more than $9 billion in mortgage relief, though data show that most has gone toward forgiving home equity loans and approving short sales that do little to keep distressed borrowers in their homes.
Homeowners have filed hundreds of complaints claiming banks delay loan-modification requests, repeatedly request new documents, and pursue foreclosure while modifications are under way.
New York's attorney general filed suit Wednesday against Wells Fargo, claiming the country's largest home lender had continued to violate terms of the settlement even after learning of problems reported by homeowners.
Contact Drew Harwell at (727) 893-8252 or [email protected]