The White House said on Thursday the administration is reviewing legislation that could make it more difficult for homeowners to challenge unjustified foreclosure actions.

White House officials held meetings on the bill to weigh whether the president should sign or veto the legislation, White House spokesman Robert Gibbs said.

The bill, which zoomed through the Senate last week with no public debate, could save bank and mortgage processors from liability for foreclosure documents that were prepared improperly.

It requires courts to accept all out-of-state notarizations, including those stamped en masse by computers.

False notarizations have been a big issue in the recent disclosure that GMAC, JPMorgan and other big mortgage processors filed false affidavits in thousands of foreclosure cases.

The bill, passed by the House of Representatives in April, seemed destined to die with no action on it in the Senate Judiciary Committee. But on September 27, the day before the Senate recessed for the midterm election campaign, it was rushed through and passed by the full Senate with no public debate.

Gibbs said after officials considered potential effects of the bill, I think in general obviously there is concern, ultimately, about the situation. He said the White House may disclose later today a decision on whether the president will sign the bill.

Its passage caught homeowners' advocates, including lawyers and some state officials, by surprise.

Ohio Secretary of State Jennifer Brunner said it seemed odd that the law passed just as disclosures of fraudulent foreclosure were mushrooming, leading to widespread halts in foreclosure proceedings.

The bill, the Interstate Recognition of Notarizations Act, had received almost no public attention, but stirred controversy once the Senate's unusually rapid passage of bill became public.

Congressional staffers said many lawmakers and White House officials initially didn't realize that the bill, which nominally deals only with notarizations, could have big impact on foreclosure cases.

(Reporting by Caren Bohan; Editing by Sandra Maler and Vicki Allen)

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