Nationstar Mortgage Holdings under Foreclosure Scrutiny
Nationstar Mortgage Holding’s actions have come into question lately after being asked to halt all foreclosures in 23 states by four attorney generals. According to the Wall Street Journal, they resumed foreclosure proceedings after an internal review of its practices, according to a new bond prospectus filed by the firm.
4 State Attorney Generals Asked Nationstar to:
- Suspend foreclosures in October 2010. The registration was filed with the Securities and Exchange Commission for $1.4 billion to be offered in senior notes.
- Halt all foreclosure proceedings until internal reviews are done to ensure compliance with the law.
- Provide information to U.S. authorities from servicers, such as Nationstar, in regards to notarization and affidavit procedures.
Nationstar’s Defense
- Documents do not indicate that the filings give a clear timeframe for its requests, or for the suspension of the foreclosures.
- Regarding notarization and affidavit procedures, Nationstar continued to say their loans in 2012 were “not affected” by the many inquires. Yet, they could not say whether future foreclosures would be affected by similar questioning.
“The company received the request from authorities for the foreclosure halt in October 2010, though it was not known how long the halt lasted or when the procedures resumed.” –Nationstar spokesman
Nationstar Has Not Made Any Changes
There is also no sign from Nationstar that they will change any of their practices as of a result from the review.
Inquiries, court backlogs, and growing court procedures could cause extended delays in foreclosure proceedings. They could also potentially increase the firm’s costs, said the Lewisville, Texas company which handles administrative duties on more than 1.8 million home loans.
Threats from the New York attorney general charge other banks for not complying with the terms of a $25 billion foreclosure-abuse settlement in 2012. This pact was created to address wrongs such as “robosigning,” a practice in which firms and banks certify legal documents without following laws.
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