Federal Reserve chairman Ben Bernanke said the central bank is "looking intensively" at the foreclosure and servicing practices of the nation's largest banks to see if these institutions are improperly taking homes.
Speaking Monday morning at a Fed/FDIC forum on mortgages and foreclosures, the nation's central banker said "We take violations of proper procedures seriously" and promised that sometime next month the agency will have the "preliminary results" of its review completed.
According to figures compiled by National Mortgage News and the Quarterly Data Report, roughly 3% of all conventional loans are in foreclosure but the rate for subprime mortgages is 13%.
Among the Fed's goals is to determine whether "systematic weaknesses" are leading to improper foreclosures, Bernanke said. "We take violations of proper procedures seriously."
As reported by National Mortgage News last week, FHA and HUD also are reviewing the foreclosure/servicing practices of their lenders.
The nation's attorneys general have launched a probe into foreclosure abuses too, but to date, no national moratorium has been declared, nor is one anticipated at this time.
