In a move to follow in the footsteps of the recent Bank of America $8.4 billion predatory lending settlement, the State Foreclosure Prevention Working Group is adding pressure and much needed media attention on the mortgage servicing crisis.
In a letter signed by Iowa Attorney General Thomas Miller on behalf of the State Foreclosure Prevention Working Group and officials in Arizona, California, Illinois, Massachusetts, Michigan, New York, North Carolina, Ohio and Texas, the group is calling for a nationwide loan modification program and threatening litigation if mortgage servicers do not cooperate.
A copy of the AG’s letter can be seen here.
The Wall Street Journal Reported:
“We believe that every major servicer of subprime loans should adopt these types of programs as soon as possible,” state officials said in a letter sent Tuesday to 16 servicers. “We urge you in the strongest possible terms to adopt a comprehensive, streamlined and effective loan modification program as soon as possible.”
Mr. Miller said his office has already heard from three major mortgage servicers, who have asked for details on the settlement. “Our first approach is to work with everybody,” he said. “Later on, if it is necessary, we would consider litigation.”
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