HSBC halts US foreclosures over paperwork errors

HSBC Holdings PLC says it is suspending foreclosures in the U.S. after a government review of the lender's procedures revealed problems with the way it handled some home repossessions.

HSBC Holdings PLC says it is suspending foreclosures in the U.S. after a government review of the lender's procedures revealed problems with the way it handled some home repossessions.

The London-based bank's foreclosure moratorium came to light in its annual report Tuesday.

HSBC says U.S. government officials determined there were certain deficiencies in the way the lender prepared affidavits and other foreclosure-related documents.

The lender says it will resume foreclosure actions once it has substantially addressed the problems.

HSBC says it expects heightened scrutiny over foreclosure documents to increase, which could result in additional delays in the foreclosure process once the lender ends its moratorium.

Foreclosure document errors and heightened government oversight over the process prompted several major lenders to temporarily freeze foreclosures last fall.

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