Moody's Investors Service downgraded Bank of America ratings on collections and loss mitigation services citing a "deterioration".
Bank of America was among several major lenders that signed consent orders with the Department of the Treasury after an investigation into their loss mitigation practices. B of A plans to fully implemet these orders within 3 - 6 months and stated that they were not surprised at the downgraded rating.
This further explains why lenders are holding onto their "shadow" inventory. They are afraid of class action suits and further action by the DOT until they "get their sh.. together". The president of BofA stated over a year ago that he wasn't ware of any problems and vowed to fix the situation. My question is: why is it taking these lenders so long to figure this out? We are not talking brain surgery here!!
For what it is worth, you can read the article here http://bit.ly/mTjW10