SunTrust Banks found problems in 4,000 active foreclosure cases during an internal review of its practices, the bank said Friday in a regulatory filing.
Atlanta-based SunTrust said it found “technical issues” in fewer than 15 percent of active cases. The filing said some employees signed foreclosure documents without personally verifying the loan information. The practice has been labeled by some consumer advocates as "robo-signing."
“We do not believe that any potential deficiency identified violated applicable law,” the company said in its annual proxy filing. The bank also said it is “undertaking similar remedial action in non-judicial foreclosure states as necessary and appropriate.”
A SunTrust spokesman declined to comment beyond the filing, other than to say the bank expects to complete its review and resubmit necessary foreclosure documents by the end of the first quarter.
The bank does not expect a prolonged delay in foreclosure processing, the filing said.
Bank of America, Ally Financial and a number of large mortgage companies suspended foreclosures temporarily last year after irregularities were found in their foreclosure practices.
The U.S. Justice Department and the attorneys general of all 50 states have started probes of the industry.
SunTrust, which has mortgage operations throughout the country, did not break down the problems geographically but said the issues were discovered in states that require court intervention in foreclosure cases.
Georgia, like most states, does not require a court hearing in order for lenders to foreclose. The filing mentions requirements in Florida, where much of the legal action surrounding the foreclosure crisis has centered.
The foreclosure review started in September. The bank said it expects foreclosure costs to rise modestly in 2011 as a result to changes in its foreclosure processes.
