As Foreclosures Ramp Up, New Roadblocks Ahead

CNBC.com | July 09, 2012 | 04:25 PM EDT

Fraudulent foreclosure practices, a.k.a. “robo-signing,” uncovered now nearly two years ago, opened a new wound in the foreclosure crisis that was in the process of healing.

At big bank mortgage servicers and in courts in many states, the foreclosure process ground to a halt, and the pipeline of delinquent loans swelled to historic levels. Lawsuits abounded and lengthy settlement negotiations on all levels of government began.

Nearly two years later, the foreclosure mechanism is just starting to move again.

Foreclosure starts, the first phase of the process, rose nearly 12 percent in May month-to-month, according to a new report from Lender Processing Services. Foreclosures sales, when the property goes back to the bank or to a bidder at the courthouse steps, rose 10 percent.  Read the full article here