Obama to Veto Notarizations Legislation That Might Impact Foreclosures

Today, President Obama announced he will not sign H.R. 3808, the Interstate Recognition of Notarizations Act of 2010, quietly passed through the Senate with no debate on Sept. 27. Instead, the president will return the bill to the House, effectively killing the legislation. White House Communications Director Dan Pfeiffer explains on the White House blog:

The Interstate Recognition of Notarizations Act of 2010 was designed to remove impediments to interstate commerce.  While we share this goal, we believe it is necessary to have further deliberations about the intended and unintended impact of this bill on consumer protections, including those for mortgages, before this bill can be finalized.

Notarizations are important for a large range of documents, including financial documents.  As the President has made clear, consumer financial protections are incredibly important, and he has made this one of his top priorities, including signing into law the strongest consumer protections in history in the Wall Street Reform and Consumer Protection Act.  That is why we need to think through the intended and unintended consequences of this bill on consumer protections, especially in light of the recent developments with mortgage processors.

The authors of this bill no doubt had the best intentions in mind when trying to remove impediments to interstate commerce.  We will work with them and other leaders in Congress to explore the best ways to achieve this goal going forward.

H.R. 3808 went barely noticed in the press, and even among members of Congress, until it reached Obama’s desk as the foreclosure fraud crisis came to light. Housing advocates vocally insisted that Obama veto the legislation, as it might make it easier for banks to force foreclosure-related evictions using paperwork without the proper signatures.