(WASHINGTON) -- The White House has signaled rejection of a national moratorium on home foreclosures as attorneys general from 40 states called Wednesday for a national investigation into the process.
Some banks have already halted foreclosures because of allegations banks and mortgage companies hired unqualified workers to essentially rubberstamp foreclosure paperwork. In some cases, so-called "robo-signers" approved thousands of foreclosures a day. Many people who had faithfully made their payments received foreclosure notices.
White House Advisor David Axelrod told CBS Face The Nation over the weekend the problem is a serious one, but an outright moratorium would cause difficulties in cases where a foreclosure is justified and should proceed. Number two House Republican Eric Cantor said on Fox News Sunday a national moratorium would remove protection lenders need and "shut down the housing industry." Democrat and Florida Representative Debbie Wasserman Schultz backs a foreclosure moratorium, telling Fox the problem has been "extremely vexing" in her state.
Axelrod says the White House is pushing lenders to speed up their review process to find the bad paperwork and save paid-up homeowners from that shock at the mailbox.
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