JPMorgan Finds Itself an Ally.

JPMorgan Chase reportedly is delaying foreclosure proceedings to systematically review documents after alerting attorneys that employees may have signed affidavits without personally reviewing the documents, the same issue that has plagued GMAC Mortgage (Ally).

"It has come to our attention that in some cases employees in our mortgage foreclosure operations may have signed affidavits about loan documents on the basis of file reviews done by other personnel – without the signer personally having reviewed those loan files," Kelly said.

Story here: Robo-signer

The implications of this are pretty big.  The bank cannot foreclose where affidavits are required and someone has not actually reviewed the file.  Think of the size of the foreclosure pipeline.  This will stall the process then clog the courts for some time.  Until this foreclosure process continues and the market is allowed to clear, housing cannot begin to recover.