*** The Housing is a Human Right Committee of Metro Justice is looking into pursuing a similar policy for the Rochester-area.
Tuesday, October 19, 2010— With three of the nation’s leading mortgage lenders admitting to questionable and perhaps illegal practices in their mortgage foreclosure actions, Cook County Sheriff Thomas J. Dart announced Tuesday he will not carry out any evictions involving those lenders until they can provide complete assurance that the foreclosure was done properly and legally.
The moratorium is set to take effect Monday – giving the affected banks 5 business days to respond to a letter Dart sent to them last week. It impacts foreclosure eviction orders filed with Dart’s office by Bank of America, J.P. Morgan Chase and GMAC/Ally Financial – which, along with their subsidiaries, make up about 1/3 of the approximately 3,700 eviction orders filed with Dart’s office annually.
In recent days, each of those lenders has admitted it is uncertain about the legitimacy of some of their foreclosure actions. Specifically, some employees said they never read foreclosure documents before attesting that the foreclosures had been verified and were justified. Though some lenders put a freeze on new foreclosures or those in the midst of legal proceedings, nothing was stopping eviction orders already given to sheriff’s deputies from being carried out.
On Monday, Bank of America announced it had reviewed thousands of foreclosure documents in Illinois and elsewhere and will properly re-file some of its foreclosures beginning next week – though Dart questions those already waiting for his deputies to execute or those already done.
Right now, Dart’s office has 500 eviction orders waiting to be executed,
with 1,000 more being prepared to be executed – 1/3 of which would be
impacted by such a moratorium.
“I can’t possibly be expected to evict people from their homes when the banks themselves can’t say for sure everything was done properly,” Dart said. “I need some kind of assurance that we aren’t evicting families based on fraudulent behavior by the banks. Until that happens, I can’t in good conscience keep carrying out evictions involving these banks.”
Dart plans to extend the moratorium on evictions to any other lending institutions which also publicly admit to or which investigators find engaged in similarly questionable practices.
Dart’s move comes exactly two years after he refused to carry out any foreclosure evictions, after he found renters were receiving no notice from the banks that the building they were living in was in foreclosure and that they were about to be evicted. That led to new requirements in Cook County for lenders to attest they provided proper notice to tenants before they can file a foreclosure action. It also led to a new three-step notification process by Dart’s office for every property where they are ordered to conduct a foreclosure eviction, further assuring proper notice is given.
Today’s action by Dart comes only after Bank of America, Chase and GMAC officials acknowledged they are reviewing all of their foreclosure filings to ensure they were legally done. Additionally, attorneys general across the United States are teaming to investigate whether deceptive, unfair or illegal actions led to any foreclosure filings in their state by these or any other lenders.
On Friday, Dart sent notice to attorneys for the affected banks that he wants them to provide an affidavit affirming any foreclosures they file in Cook County have been properly processed in accordance with Illinois law. Additionally, he is asking those banks to provide the same for awaiting eviction orders. That’s because legal proceedings generally take about 2 years from the time a foreclosure is filed until it reaches the sheriff’s office.
Even after filing with the sheriff’s office, however, it takes about 10 months before a foreclosure eviction order is actually carried out. About 20 Cook County Sheriff’s Deputies execute approximately 14,000 foreclosure and rental eviction orders filed in Cook County every year.
With that backlog, there will be no shortage of evictions for those deputies to carry out even with this moratorium against these three lenders. As Dart awaits a response from the lenders, his deputies will continue with other eviction orders and will post notices on homes affected by this moratorium. He’ll also continue to investigate records to find any foreclosure eviction orders filed by smaller banks that were later taken over by those three lenders.
“With banks changing hands two or three times and mortgages constantly being purchased by different lenders, we just don’t know how vast this problem is,” Dart said. “What I do know is that there is a cloud over every one of their foreclosure filings.”
Recent reports from the mortgage industry indicate more than 102,000 homes in the Chicago area were re-possessed by banks in September. The same findings show one out of every 30 homes in Cook County is at some stage of foreclosure. Those figures, Dart said, show the importance of ensuring every foreclosure filling has been done fairly and properly before families are evicted.
In November 2008, Dart testified before the U.S. Senate Judiciary Committee about the importance of protecting families in financial crisis and called for support of legislation sponsored by U.S. Sen. Dick Durbin (D-Illinois) that would allow bankruptcy judges to reduce principal amounts on mortgages to help families facing foreclosure save their homes. In addition to asking that Durbin’s bill be re-introduced, Dart also voiced support for the effort by Illinois Attorney General Lisa Madigan and others to investigate and possibly penalize those lenders found to have skirted laws before filing a foreclosure. He also supports proposed legislation that would make it a state law for lenders to attest to every step of their foreclosure process.