HUD Secretary – Foreclosure Problems Aren’t Systemic

In the Federal Task Force meeting on Wednesday, the Secretary of Housing and Urban Development, Shaun Donovan said they have been aware of violations with certain servicers for some time and they will “take actions”. However, he stopped shy of identifying any systemic problems instead citing isolated non specific problems. More details could become available when the FHA probe is completed in about nine weeks. The Federal Task Force investigation has now shifted to determining whether there was “criminal intent to take a home” “robo-signing” or fraud. Any mortgage servicers found guilty of these actions could face hefty fines or lose their ability to work with the Federal Housing Administration at a minimum. It is still too early to tell which lenders may face charges and what effect any such charges would have on the lending industry as a whole.

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