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Foreclosure Freeze By Citibank, Wells Fargo, Bank of America & Chase

February 14th, 2009 categories: Foreclosures / Short Sales, The Economy

lock-with-red-cirle-and-slashNo New Foreclosures Until Government’s Foreclosure Prevention Plan Is Ready

Four of the world’s biggest banks have all agreed to temporarily halt foreclosures while President Obama and his staff put together a plan designed to help people stay in their homes.

Heavy hitters JPMorgan Chase, Bank of America, Citigroup, and Wells Fargo all have said they will not foreclose for the time being. All four banks received a public dressing-down by Congress earlier in the week for their apparent failure to use billions of dollars of government money that came their way as part of last year’s bailout for the purpose it was intended.

By the end of the week, four of the eight CEOs who were grilled and chastised by Congress publicly announced that they would put a temporary mortorium on new foreclosure proceedings, something that Rep. David Scott (D-Georgia) had sternly requested during Wednesday’s Congressional hearings.

President Obama has indicated that he expects to announce his foreclosure prevention plan next week.

Here’s what the four banks each announced, according to various news reports I’ve read:

  • JP Morgan Chase — A moratorium on new foreclosures of owner-occupied homes will be in effect through Mar. 6.
  • Citigroup — A moratorium on all principal-residence foreclosures through Mar. 12 or the date the government finalizes its loan-modification program, whichever occurs earlier.
  • Bank of America — A moratorium on owner-occupied homes owned or serviced by both BofA and its Countrywide unit will remain in effect through Mar. 6, with a possible extension beyond that date if warranted.
  • Wells Fargo – A foreclosure moratorium on its loans until the government’s foreclosure prevention plan is finalized. Presently, the moratorium will only apply to loans held by Wells Fargo or its Wachovia unit, though Wells is apparently also encouraging investors on the loans it ” services” to follow suit. (Note: many banks collect payments as a “servicer” for the actual owner (investor) of that loan.)

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This entry was posted on Saturday, February 14th, 2009 at 8:58 am and is filed under Foreclosures / Short Sales, The Economy. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.

  1. DAVID MORGAN said at February 16th, 2009 at 12:19 pm

    WE’VE ATTEMPTED TO WORK OUT ANYTHING WITH LIME FINANCIAL, WHILESHIRE, AND NOW WELLS FARGO BANK BUT NO ONE WILL WORK WITH US. WE COULD PAY BETWEEN $400,000.00 TO $500,000.00 AT 3 OR 4% INTEREST. I AM A COMMERCIAL REAL ESTATE AGENT THAT HAD MORE THAN ENOUGH MONEY TO PURCHASE MY HOME BUT THERE WAS NO WAY FOR ME TO SEE THE HOUSING COLLAPSE. WE FEEL AS THOUGH ALL THE WORK WE’VE DONE FOR 36 YEARS HAS BEEN FOR NOTHING. WE HAD RETIREMENT, LAND AND A SAVINGS AND NOW I’M WORKING 3 JOBS TO SURVIVE. WE CAN DO IT IF WELLS FARGO WOULD JUST RELENT AND WOULD HELP FAMILYS INSTEAD OF WANTING TO SELL OUR HOME TO SOMEONE ELSE. IF THEY WOULD DO THIS THEN FAMILYS THAT CAN PURCHASE HOMES WOULD BUY NEW HOMES AND LEAVE FORECLOSURES ALONE. THEN AND ONLY THEN WILL YOU SEE MONEY FLOWING THROUGH THIS ECONOMY AGAIN. AT LEAST IT’S A START. PLEASE HELP SAVE EVERYONES HOME THAT IS STILL OWNER OCUPIED.

    SINCERELY,

    DAVID MORGAN

  2. Rod Herman said at February 16th, 2009 at 9:56 pm

    Unfortunately, while banks have talked a lot in the press and before Congress about supporting loan modifications and other foreclosure prevention efforts, in many cases it’s amounted to nothing more than lip service. I would share your story with your Congressmen in hopes that they’ll carry your torch as they try to correct our nation’s ills. They really need to hear first-hand from those who are caught in the crosshairs of the banking industry’s unwillingness to make decisions based on common sense and sound reason.

    Have you talked to the real decision-makers at Wells? Often, the borrower ends up speaking only to an entry-level staffer who has no authority to think outside the box nor the ability to understand anything presented in black-and-white, even if it makes perfect sense.

    I wouldn’t give up. If you really have a case that feels like a no-brainer, keep pursuing it with Wells and escalate it all the way up to the Chairman of the Board if you have to.

    Best of luck, David. I’ll be anxious to hear if you have any success.

    And thanks for reading & commenting…

    - Rod

  3. Foreclosure said at December 2nd, 2009 at 3:03 pm

    Generally I do not post on blogs, but I would like to say that this post really forced me to do so! really nice post,and very informative.

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