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GMAC Apologizes for Actions of Robo-Signer

Sep 24, 2010

The following is taken from an announcement by GMAC Mortgage in refernce to their recent troubles with suspending foreclosure actions in 23 states: As a loan servicer, GMAC Mortgage strives to preserve homeownership whenever possible and the company has completed more than 220,000 permanent loan modifications since 2008. There are circumstances, however, when a loan modification is not possible and foreclosure proceedings must be exercised. The foreclosure process is a lengthy procedure which does not get initiated until after many months of delinquency, default and when all loss mitigation efforts have failed. Preserving the integrity of the foreclosure process is of the utmost importance. Regrettably, a procedural error was found to have occurred in certain affidavits required in certain states. The error is not related to the accuracy of the underlying transaction or the ultimate decisions to have exercised the foreclosure proceedings. We believe that the substantive contents of the affidavits in question were factually accurate and our internal review to date has revealed no evidence of any factual misstatements concerning the details typically contained in these affidavits such as the loan balance, its delinquency, and the validity of the note and mortgage. The issue involves two specific areas: ►Signing the affidavit in the physical presence of a notary public. ►Signing the affidavit with direct personal knowledge of all the information stated in the affidavit rather than knowledge and reliance upon the direct personal knowledge of other personnel, agents and local foreclosure counsel. We believe the defects occurred in some, but not all foreclosures in the 23 impacted states. The problem was identified and then addressed a few months ago, and the execution process has been corrected. The changes that were made to the internal process include: ►All employees with responsibility for signing documents have undergone additional education and training. ►A more robust policy on the requirements for this process was issued. ►The number of employees performing this process was substantially increased. We are actively addressing all of the foreclosure proceedings in which this practice may have occurred. Contrary to recent press reports, GMAC Mortgage is not suspending foreclosures in any state. The company has temporarily suspended evictions and post-foreclosure closings in the 23 states while we conduct a review. We hope to see the vast majority remediated over the next several weeks and before year-end without serious consequence to the foreclosure process on the properties which are affected. While we are exercising an abundance of caution in the review process, we are confident that the processing errors did not result in any inappropriate foreclosures. If upon further review, we discover any harm resulting from these procedural errors, we will address and rectify it promptly. GMAC Mortgage apologizes for the error and any related confusion and is working to resolve the situation expeditiously. For more information, visit
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