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NEWARK
– The Office of the Attorney General,
through the Division of Consumer Affairs,
is assessing whether the state’s Consumer
Fraud Act has been violated by companies
that have admitted to not properly reviewing,
factually verifying and signing foreclosure
filings submitted to the courts.
New
Jersey has asked mortgage companies to provide
documentation on how they have performed
foreclosure filings. The state also has
contacted the National Association of Attorneys
General to discuss collaborative efforts.
“I’m
concerned that what some are calling ‘shortcuts’
in the filing process may in fact be a systemic
pattern of fraud committed in our state
court system,” Attorney General Paula
T. Dow said. “These companies have
a legal obligation to follow procedures
before they attest to the facts.”
Ally
Financial, formerly known as GMAC Mortgage,
announced two weeks ago that it was imposing
a moratorium on foreclosures in 23 states,
including New Jersey, after disclosing that
its employees routinely signed off on foreclosure
affidavits without properly reviewing them
or verifying their accuracy. JP Mortgage
Chase and Bank of America have since announced
similar halts to foreclosure proceedings.
“I’m
asking all mortgage holders who are in the
foreclosure process to pause, review their
procedures, and ensure that all statements
that they attest to are, in fact, properly
reviewed and confirmed as being accurate,”
Attorney General Dow said. “New Jersey
homeowners who are facing the trauma of
foreclosure and eviction are entitled to
no less.”
In
New Jersey, foreclosure actions must be
supported by an Affidavit of Amount Due,
which establishes the identity of the mortgage/note
holder and information concerning the default.
“We
want to know what past practice has been,
and if we find the Consumer Fraud Act has
been violated, we expect the companies to
reform their business practices and to help
any affected homeowners,” said Thomas
R. Calcagni, Acting Consumer Affairs Director.
“The large number of mortgage defaults
and foreclosure procedures that have occurred
is no excuse for denying borrowers due process.”
The
Division of Law is working with the Division
of Consumer Affairs on this matter.
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