Bank of America has been harder hit by the mortgage crisis than any other bank. Only Wells Fargo comes close with a disproportionate share of their assets coming from mortgages.
As Bank of America tries to clean up its mortgage division, more homeowners as a result are getting pushed into foreclosure.
This is not necessarily bad. If people can’t make their monthly mortgage payments on time, then lenders have every reason to foreclose on them.
Bank of America needs to clean up its books and to make a better case to stockholders. Paperwork woes slowed up its foreclosure program for nearly a year but that’s hopping now.
Bank of America stock has dropped more than 50% this year.
The bank feels pressure to clean up their risky mortgage loans, to move defaulted loans into foreclosure, to sell them and to move on.
The number of homes across the country that received an initial default notice — the first step in the foreclosure process — jumped 33% in August from July, the foreclosure listing firm RealtyTrac reported last week. It was the largest monthly increase since August 2007, right after the housing bubble had burst.
Now a preliminary analysis reveals the largest escalation of foreclosures came from Bank of America (BAC). Just in California, default notices sent by Bank of America soared 96% in August from the previous month.