The federal Office of the Comptroller of the Currency has released its analysis of the Independent Foreclosure Review, a short-lived process that sought to quantify wrongful foreclosures at the peak of the mortgage crisis.
The report revealed that more than 50 percent of the errors identified in the audits before they were terminated last year and replaced with cash settlements to borrowers were tied to administrative flaws and improper fees charged to homeowners during the foreclosure process. At least 9 percent of the errors, meanwhile, arose from banks improperly rejecting loan workouts that would have prevented foreclosures.
The OCC report also showed that banks had not made much progress before the reviews ground to a halt, with Bank of America going over just 6 percent of its foreclosure files and Wells Fargo scrutinizing about 9.6 percent. With the filed they had reviewed so far, the two banks were found to have error rates of 8.9 percent and 11.4 percent, respectively.