HSBC Holdings PLC says it will temporarily suspend foreclosures after a government probe revealed problems in the way it has handled some of its foreclosures.
Government officials uncovered problems with the way HSBC lenders prepared affidavits and other foreclosure-related documents.
The bank said it will review all foreclosures that it has completed and re-file any paperwork, if necessary. HSBC plans to resume foreclosures once it has addressed the problems from the government probe, but it expects more delays in its foreclosure process for borrowers.
Several banks have been under fire in recent months, facing accusations of “robo-signing” hundreds of foreclosure documents daily without careful review or giving borrowers an opportunity to do a loan modification. Lenders repossessed a record number of more than 1 million homes in 2010, according to RealtyTrac Inc.
Source: “HSBC Temporarily Halts Foreclosure Actions in the US After Probe Finds Processing Deficiencies,” Associated Press (March 1, 2011)