By Stephanie Stewart
On January 23, 2012, state attorneys general from across the country received the draft of a proposed $25 billion settlement agreement with the nation’s largest banks that would substantially restructure foreclosure and mortgage services practices. The five biggestU.S.mortgage lenders – Bank of America, JPMorgan Chase, Wells Fargo, Citibank, and Ally Financial – have all agreed to the settlement, which comes in the wake of the multi-year investigation into the foreclosure practices of these institutions. The investigation revealed that several of these banks were engaging in “robo-signing,” a practice in which bank employees sign documents they have not read or use false signatures to sign off on foreclosures. Many of the companies that processed these mortgages then failed to verify the information on the foreclosure documents. These practices have forced literally hundreds of thousands of people from their homes. Indeed, nearly 8 million people have faced foreclosure since the housing bubble burst. (more…)