FDIC Clarifies Expectations for Abandoned Foreclosures

The FDIC today clarified its expectations for banks when discontinuing foreclosure proceedings. The agency said that banks must have appropriate policies and practices in place to obtain and assess current information on the market value of the property subject to foreclosure; determine whether liens on the property should be released; notify local authorities of their decision to abandon the foreclosure; and notify the borrowers that the foreclosure has been discontinued.