Bank executives are expecting to get an earful from lawmakers Tuesday when they defend themselves in front of the Senate Banking Committee against allegations they mishandled thousands of home foreclosures.
The banks’ likely defense – that the volume of foreclosures was so great that they were simply overwhelmed – isn’t likely to placate politicians looking to score points with struggling homeowners.
While the sputtering economic recovery has left far more people out of work than was expected, greatly hampering any recovery in the real estate market, bankers are nonetheless expected to concede that the foreclosure system is broken, and that they are working on ways to repair it. Part of the problem, the bankers will say, stems from the demands of investors – including Fannie Mae and Freddie Mac.
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