Wells Fargo to re-file 55,000 foreclosure documents
TEXT OF INTERVIEW
JEREMY HOBSON: Wells Fargo says it’s going to re-file paperwork for 55,000 foreclosures. The bank says it’s found problems with the documents. But it’s not going to issue a blanket moratorium on foreclosures, like Bank of America did briefly.
Marketplace’s Nancy Marshall Genzer joins us now, live from Washington, to talk about foreclosuregate and a new report on foreclosures that’s out today. Good morning, Nancy.
NANCY MARSHALL GENZER: Good morning, Jeremy
HOBSON: So, how are all the paperwork problems we’ve been learning about, and now this new news from Wells Fargo affecting the overall rate of foreclosures?
GENZER: Well Jeremy, there will probably be a temporary decrease in the number of foreclosures in the last quarter of this year. But they’re go back up once the paperwork is re-filed. Wells Fargo, and all the other banks, say they’re just having problems with the documentation.
HOBSON: So even if we get a brief reprieve you’re saying things will get worse eventually?
GENZER: Yes, unfortunately. Foreclosures are expected to be back up next year, for a couple of reasons. Banks are going to be re-filing their paperwork. Those foreclosures will go through, barring any more problems with documentation. But the bigger driver behind foreclosures next year will be the fact that adjustable rate mortgages are going to adjust upward. I talked to Rick Sharga about this. He’s vice president of RealtyTrac. They’re issuing that report on foreclosures today that you mentioned a minute ago.
RICK SHARGA: When you think about the fact that a lot of these borrowers were only marginally qualified to begin with and would now be faced with paying a thousand dollars more a month on a property that’s lost 30, 40, 50 percent of its value since the time they bought it, it’s a pretty toxic mix.
Sharga says foreclosures will actually peak next year. 2011 will set records for the number of foreclosures and bank repossessions of homes.
HOBSON: More trouble ahead. Marketplace’s Nancy Marshall Genzer in Washington, thanks.
GENZER: You’re welcome.
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