Our Terms of Service and Privacy Policy have changed.

By continuing to use this site, you are agreeing to the new Privacy Policy and Terms of Service.

Ohio AG to Ally: Stop foreclosure sales

By Charles Riley, staff reporter

NEW YORK (CNNMoney.com) -- Ohio's top law enforcement official, firing another shot across the bow of Ally Financial, asked a judge on Friday to stop the sale of foreclosed homes in cases that relied on faulty paperwork.

State Attorney General Richard Cordray sued the lender last week, alleging that the bank and its employees had signed and filed at least hundreds and potentially thousands of false affidavits in foreclosure cases.

The cornerstone of the state's case is the testimony of Jeffrey Stephan, who has admitted to signing thousands of affidavits on Ally's behalf without person knowledge of the facts of each case, as required by law.

Ally has previously announced that it was temporarily suspending evictions and post-foreclosure closings in the 23 states in which judges must sign off before someone loses their home.

The company, previously known as GMAC, the finance arm of General Motors, has also hired outside accounting and legal firms to examine its foreclosure procedures in all 50 states.

But Cordray, who has been among the nation's most aggressive attorney generals on the issue of robo-signing, alleges that Ally is not acting to slow the foreclosure process in any meaningful way.

"GMAC is generally not moving to vacate the fraudulently obtained judgments. Indeed, often GMAC counsel is telling the courts that soon they expect to again request that the applicable Sheriffs sell the properties and evict the homeowners," according to a request for an injunction filed by Cordray Friday.

For its part, Ally denies it is proceeding with sales.

"GMAC Mortgage is not proceeding with foreclosure sales in Ohio using defective affidavits, spokesman Jim Olecki said in a statement. "We announced weeks ago that we were suspending evictions and foreclosure sales in the 23 judicial states, including Ohio, until a review was conducted and any needed remediation activity was completed in those affected cases."

On Wednesday, the top prosecutors in all 50 states announced a coordinated probe into improper foreclosures by the nation's largest loan servicers, but stopped short of calling for a freeze on all foreclosures.

The group of attorneys general and bank regulators will work to put an immediate stop to improper mortgage foreclosure practices. It will also review past and present practices by loan servicers and come up with potential remedies. To top of page

Overnight Avg Rate Latest Change Last Week
30 yr fixed3.88%3.83%
15 yr fixed2.84%2.96%
5/1 ARM3.24%3.09%
30 yr refi3.92%3.94%
15 yr refi2.94%3.05%
Rate data provided
by Bankrate.com
View rates in your area
Find personalized rates:
  • Find Homes for sale
    Real estate and homes for sale on Trulia

  • Property Type
  • Find a home in: New York | Atlanta | Chicago | Los Angeles
  • Washington D.C | Houston | Philadelphia | More options
Index Last Change % Change
Dow 16,472.37 200.36 1.23%
Nasdaq 4,707.78 80.69 1.74%
S&P 500 1,951.36 27.54 1.43%
Treasuries 1.99 -0.05 -2.60%
Data as of 4:49am ET
Company Price Change % Change
Bank of America Corp... 15.38 -0.17 -1.09%
Apple Inc 110.38 0.80 0.73%
Micron Technology In... 15.91 1.14 7.72%
General Electric Co 25.47 0.28 1.11%
Microsoft Corp 45.57 0.96 2.15%
Data as of Oct 2


After years of talks, negotiators for the United States and 11 other nations are trying to hash out final terms of a controversial free-trade agreement. The Trans-Pacific Partnership, or TPP, would make trade easier across many areas of business. More

Smarties, a Halloween candy staple, have been around for 66 years. Three Millennial women are revolutionizing it. More

Spending more than you make is bad for your finances, but other not-so-obvious money habits will hurt your long-term savings. More