WH: Feds Probing Foreclosure Error Allegations

The White House says federal agencies are investigating allegations of widespread errors in foreclosure documents.

White House press secretary Robert Gibbs says in a statement that an interagency task force on financial fraud has launched an investigation into the foreclosure process. He also says the Federal Housing Administration, a federal agency that guarantees mortgages, is investigating, too.

"We remain committed to holding accountable any bank that has violated the law," Gibbs says.

White House Caves on Foreclosuregate
Bank of America to Resume Foreclosures

Gibbs says the administration supports an effort by attorneys general in 50 states to investigate the matter. Several administration officials, however, have said over the past week that they don't back a nationwide halt to foreclosures.

On Monday, Bank of America said that it plans to resume seizing more than 100,000 homes in 23 states next week. It said it has a legal right to foreclose despite accusations that documents used in the process were flawed.

Other major leaders have yet to say whether they will follow suit and resume foreclosures in the states that require a judge's approval. But analysts expect the move by the nation's biggest bank will give way to an industrywide effort to push ahead with a wave of foreclosures that have depressed the housing market.

Bank of America Corp. says it's confident of its foreclosure decisions in a majority of its questionable cases. The bank is still delaying foreclosures in the 27 other states, which don't require a judge's approval.

Its move comes two weeks after the bank began halting foreclosures nationwide amid allegations that bank employees signed but didn't read documents that may have contained errors.

"The basis for our foreclosure decisions is accurate," Dan Frahm, a Bank of America spokesman, said in announcing the bank's new approach.

The company said it plans to resubmit documents with new signatures in the 23 states that require a judge's approval to restart the foreclosure process. It will delay fewer than 30,000 foreclosures.

Bank of America was the only lender to halt foreclosures in all 50 states. Other companies, including Ally Financial Inc.'s GMAC Mortgage unit, PNC Financial Services Inc. and JPMorgan, have halted tens of thousands of foreclosures after similar practices became public.