Foreclosure Process Of Properties Still Under Scrutiny.

The method by which lenders processed foreclosure bank owned properties is still being examined by regulators and the central bank, according to U.S. Federal Reserve Chairman Ben S. Bernanke. He stated that results of the investigation will be available by next month.
According to Bernanke, the government is concerned about alleged irregularities in the processing of foreclosures. He added that they are studying intensively the way a distressed foreclosure home is being processed by lenders and whether there are practices that lead to faulty foreclosures.
Bernanke further added that they take seriously any violation in the processing of houses in foreclosure. The Fed Chairman delivered the speech during a conference on housing finance and loan mortgages organized by the Federal Reserve and the Federal Deposit Insurance Corp. However, Bernanke reportedly did not issue any statement about monetary policy or about the future of the nation's economy.
The conference was held a week before the Fed is scheduled to discuss issues such as foreclosure houses by state, securities buying and methods of boosting economic growth with investors and economists of the country. Bernanke also talked about the Federal Reserve's efforts to address housing market concerns during his speech.
The Federal Reserve chairman also revealed in his talk that over 20% of homeowners in the U.S. are underwater or are paying more on their mortgages than what their properties are worth. He also stated that problems with foreclosure bank owned properties will likely last for a few more years. Declining sales during the months of September and October were the primary reasons cited by Bernanke for the continuous weakness of the residential property market.
The Fed agency also expects the slowdown in housing sales and home construction to continue until the end of 2010. The agency asserted that tighter lending standards and the ongoing economic downturn are the primary reasons for this prediction.
Meanwhile, the Federal Reserve's claims are supported by the latest housing data. Housing starts are pegged at an annual rate of 610,000, with September contributing largely to the number. The figure is over 30% fewer than the record starts recorded in January 2006 which was 2.3 million. Huge supplies of foreclosure bank owned properties are reportedly affecting the construction industry's confidence in projects.

Source: EForeclosureMagazine.com