When GMAC Mortgage suspended foreclosures in 23 states over questions of legality of the process, it gave hope to thousands of homeowners struggling to hang on. It's also attracted the attention of officials in states hard hit by the foreclosure crisis.

In sworn deposition, an executive of Ally Financial, which now owns GMAC Mortgage, admitted that he did not always sign or read foreclosure affidavits, as required by law. That's prompted a letter to the company from Illinois Attorney General Lisa Madigan, demanding a meeting.

In her letter, Madigan said she's concerned the company has violated the states Consumer Fraud Act in its pursuit of Illinois homeowners in foreclosure.

Families homes are at stake here, Madigan said. If I determine that Ally is rubber-stamping affidavits and filing them with our courts as evidence, I will take appropriate action. The law demands that lenders prove their case in foreclosure actions, and Illinois homeowners demand the same.

The Ally executive testified in a Florida court case that he routinely signed affidavits for foreclosure lawsuits and submitted them to Allys attorneys without reviewing the homeowners loan documents. These affidavits were then filed with the court as evidence of Allys right to foreclose on the homes. The employee testified that he signed at least 10,000 affidavits a month without reviewing the underlying paperwork, and thus had no way of knowing whether the information in the affidavits was actually true.

Impact on Illinois homeowners

Madigan also requested that Ally immediately provide her office with details on the impact of Allys conduct on Illinois homeowners, including the number of Illinois homeowners affected by the suspension of foreclosures; the names of the Illinois law firms that Ally retains to pursue foreclosure actions; information about how these firms will implement and monitor the suspension of foreclosure lawsuits in Illinois; and the length of the suspension.

GMAC ranked fourth among U.S. home mortgage lenders in the first six months of this year, according to Inside Mortgage Finance, an industry newsletter.