(Bloomberg News) PNC Financial Services Group Inc. was on the brink of selling Jim Durden a foreclosed house in Weed, California, last month when the country's biggest banks came under public fire for improperly seizing homes. Now, he lives in an EconoLodge.

"I can't get the house ready for winter, can't install the missing water heater, can't whack the weeds down, and can't attend to the things a new homeowner needs to do," Durden, 65, e-mailed from the motel. He has been in limbo since Oct. 7 after moving his belongings 640 miles north from a Los Angeles apartment.

After Bank of America Corp. and other lenders delayed seizures almost two months ago to check their sworn court statements in thousands of foreclosures, a growing number of would-be buyers are struggling to close deals -- a sign that the documentation mess is dragging on the market. October sales of existing homes fell more than economists forecast, dropping 2.2%, the National Association of Realtors said yesterday.

Even PNC, which says an internal review found its procedures are designed to prevent unwarranted foreclosures, has ready buyers claiming the bank's review of completed foreclosures is derailing deals. A spokesman for the Pittsburgh-based lender declined to comment on Durden's case and others.

"We heard of virtually none of this happening until the so-called robo-signing scandal and subsequent foreclosure freeze," said Rick Sharga, senior vice president of RealtyTrac Inc., an Irvine, California-based real estate data provider. While there is no estimate yet for how many sales are stalled, stories like Durden's are increasingly popping up as firms try to ensure property titles are clear for resale, he said.

May Never Close

Robo-signing refers to loan-servicing workers who, in some cases, signed thousands of foreclosure affidavits without personally verifying their contents, raising concerns among courts, lawmakers and housing advocates that borrowers were improperly evicted. Rechecking documents slows the transfer of homes from banks to people who can afford them, undermining a housing recovery.

"Many of these transactions will probably never close," said Greg Rokeh, a manager of bank-owned real estate in Longwood, Florida, for Watson Realty Corp. He said he has about 25 pending sales of foreclosed homes that were put on hold amid document reviews. Most of his buyers will give up, he predicted, declining to identify the lenders involved.

Banks owned more than 950,000 properties at the end of October, up 25% from a year ago, according to RealtyTrac. The impact of stalled deals on the housing recovery "will be minimal" if the logjam is resolved within the next month or two, which is normally a slow season for sales, Sharga said.

'Huge Inconvenience'

If delays persist, more would-be buyers may find themselves biding time like Ted Roberts, his wife and two young sons, who checked into a one-room unit at the Homestead Studio Suites in Altamonte Springs, Florida last month after their purchase of a four-bedroom house was put on hold. The home was seized by Bank of America on behalf of Freddie Mac, a mortgage guarantor under U.S. conservatorship, said Erika Phelan, Roberts's real estate agent with Buyers Broker of Florida in Orlando.

Freddie Mac won't sell a house if there is any question whether it holds the title, said Brad German, a spokesman.

"We understand it is a huge inconvenience" to buyers, he said. He didn't know how many sales the McLean, Virginia-based company has stopped.

Bank of America, the biggest U.S. bank, announced Oct. 1 that it had begun halting some foreclosures to recheck paperwork. As parts of the review continue, the bank is selling houses it already owns, said Rick Simon, a spokesman for the Charlotte, North Carolina-based bank, in an interview.

Inventory Increases

Ally Financial Inc.'s GMAC Mortgage unit halted some sales of homes it had seized for itself and mortgage investors, Gina Proia, a spokeswoman for Detroit-based Ally said, declining to say how many.

"We do not expect inventory increases to be significant," she said, adding that the company's reviews and improvements of its foreclosures are "making good progress." GMAC Mortgage halted evictions in 23 states, the company said Sept. 20.

JPMorgan Chase & Co., the second-biggest U.S. bank, has continued to sell property it owns while reviewing foreclosure cases in process, said its spokesman, Tom Kelly. The New York- based bank expects to refile documents in pending foreclosures "soon," he said.

'Impenetrable Wall'

Durden was scheduled to close Oct. 8 on his $75,000 purchase of PNC's 1,150-square-foot house on Weed's Sherwood Road, he said in an interview. The bank postponed the deal a day before. He had already hired laborers to pack his 26-foot U-Haul truck and settled up with his landlord. So, the retired rigger of racing yachts drove north. Ever since, Durden and real estate broker Joe Faris, of Richter Scale Real Estate in Yreka, California, have been trying to find out when the deal will close, they said.

"It seems as though PNC has put up an impenetrable wall around them so no one can find out what is really going on," Durden said.

"PNC will not comment on any individual properties and will not comment on the assertions of third parties," a spokesman for the bank, Fred Solomon, said in an e-mail. Solomon was provided addresses by Bloomberg News for the house Durden wants along with those of three other foreclosed houses that potential buyers say are in limbo.

"Our reviews will continue as long as necessary to ensure homeowners have been treated fairly and in accordance with applicable law," he said. "In some cases, these reviews require coordination with investors."

Missing Interest Rate

In Ohio, Justin and Thara Watson said they've contacted everyone they think could help them, including their congressman, and learned nothing about when they might close their purchase of a house PNC had taken in foreclosure on behalf of Fannie Mae, another guarantor under U.S. conservatorship. They were scheduled to get the 1,500-square-foot house on St. Clair Ave. in East Liverpool for $69,000 on Oct. 15 and now are worried they'll lose the 4.75% loan they arranged.

"It would be unfair to us to lose that rate because of a bank mistake," Justin Watson said in an e-mail.

When the mortgage companies started foreclosures to review documents, Fannie Mae stopped selling houses until the companies clear up questions about titles, said Amy Bonitatibus, a spokeswoman for the Washington-based company. Fannie Mae is offering to rent its empty houses to buyers with contracts to reduce their inconvenience, she said.

Amy Hyde, of Mechanicsburg, Pennsylvania, and her husband, Daniel, and boys aged 10 and 13, are living with packed boxes in a condominium. Their deal to buy a house for $480,000 on a 1.7- acre lot on Bellows Court in nearby Lewisberry was frozen Nov. 9, Hyde said in an interview. The foreclosure was handled by PNC earlier this year and Freddie Mac, which owns the property, postponed the sale, Hyde said.

"They are talking everywhere about the economy being so bad and real estate being so bad, well this certainly isn't helping," Hyde said.