The mortgage industry must act swiftly to restore public confidence in the integrity of the foreclosure process, says Freddie Mac's chief operating officer Bruce Witherell.
In a blog Monday, Witherell called it ‘essential’ for servicers with process problems to ‘take a step back and get this right.’
In light of reports that servicers and their legal counsel neglected notary and affidavit laws when pursuing foreclosures, Freddie Mac instructed its almost 2,000 servicers to review their processes and procedures. Last week, Freddie Mac cut ties with the Law Offices of David J. Stern – a Florida firm that has been implicated in the robo-signing crisis.
‘We must safeguard borrowers' rights by ensuring that servicers follow the law and avoid shortcuts,’ Witherell wrote. ‘But we should not prevent legitimate foreclosures from going forward across the board, because the underlying rationale for foreclosing – a borrower falling irreparably behind on mortgage payments – is unlikely to change even when documentation problems are resolved.’
Freddie Mac has helped almost 370,000 borrowers avoid foreclosure since 2009, Witherell wrote.
SOURCE: Freddie Mac