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October
4,2070
Eric Holder, Attorney
General
U.S. Department
of
Justice950
PennsylvaniaAvenue,
NW,
Room
1145
V/ashinglon,
DC
20530Ben
S.
Bernanke, ChairmanBoard
of
Governors
of
the Federal
Reserve System
Twentieth
Streetand
Constitution
Avenue, N'WV/ashington,
DC
20551
John
Walsh,
Acting
ComptrollerOffice of
the
Comptroller of
the CurrencyU.S. Department
of
the Treasury
250
E
Street,
SW,
Room
9048
Washington,
DC
20219Dear
Attorney
General
Holder,
Chairman Bernanke
and
Acting
Comptroller'Walsh,As
members
of
the
CaliforniaDemocratic
Congressional Delegation, we urge
you
and
your
respective
agencies
to
investigatepossible
violations oflaw
or
regulations
by financialinstitutions in their handling of
delinquentmofigages, mortgage
modifications,
and foreclosures.
Over the last
few
years,
thousands
of
ourconstituents
have
reported thatmany
financialinstitutions,
despite
good
faith
efforts
onthe
part
of
most homeowners
to
work
out
reasonable
loan modif,rcations or
simply
seek
forbearance
of
foreclosure,
routinely
fail
to
respond
in
a
timely
manner, misplace
requested
documents,
and
send
mixed
signals
about
therequirementsthat
need
to
be
met
to
avoid
foreclosures.
'Weare
particularly
perplexedby
this
apparent
pattern
in light
of
the many incentives
Congress
and
the
Obama
Administration
have
offered
to
servicersandlenders
to
avoid foreclosures where
financially
viable,including
subsidies
and
loan
guarantees
from taxpayers.Avoidable
foreclosures
end
up being unnecessarily
costly
for
homeowners, lenders
and
servicers,
and
ourhousingmarket,whose health is
essential
to
oureconomic recovery.The
apparent
patternreported
by
our constituents
leadsus
to
conclude that
their
problems
are
notjust
personal
anecdotes
anymore.
Recent reports
that
Ally
Financial
(formerlyGMAC),
JP
Morgan,
and
Bank ofAmerica
may have
approved thousands
of
unwarranted foreclosures
only
amplify
our
concerns
that
systemic
problemsexist
in
the ways many
financialinstitutions
havedealt
with
homeowners
who
are seeking
to
avoid foreclosures.
We
are
now in
the
third
year
of
the worst housingcrisis wehave
seen
in
decades.
Far
too many
families
in
California,
and across
the
country,
continue
to
lose
their homes.
V/hile
Congressand
the
Obama
Administration
have
taken
steps
to
help
mitigate
the housing
problem,
this
PRINTED
ON
RECYCLED
PAPER
devastation
has
persistedand,
infact,
worsened
as
the
country's
unemployment
rateincreased.
We
have heard
numerous stories
offinancial institutions
beinguncooperative
at
best
or
misleading
and
acting in bad
faith
at
worst.
These
heartbreakingstories
are
coÍìmonplace,
persisting
acÍoss
the
state andacross
lenders
and
servicers.Asyou
can
see
from
the
attached
document,
whichhighlights
examples
of
casework
throughoutCalifornia,
it
appears
that
bankshave
repeatedly
misled
and
obstructedhomeowners
from receiving
the
help
Congress
and
the
Administration
have
sought
to
provide.The
excuses
we
have heard
from financialinstitutions
are
simply not
crediblethree
years
intothis
crisis.
People
in
our
districts
are
hurting.
'We
have
tried to
help them
in
the face
of
the
many
challenges
they have
faced
in their
dealings
with
financial
institutions.
It
is
time
that
banks
are
held accountable
for their
practicesthat
have
left
toomany homeowners
without
real
help.
Sincerely,
r of
Congress
NancyPelosi
Member
of
Congress
Member
of
Congress
Member of
Congress
Member
of
Congress
Member
of
Congress
Michael
M.
Honda
Member
of
Congress
Member
of
Congress
Member
of
Congress
Member
of
Congress
Napolitano
Member
of
Con
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