Goldman Sachs To End Robo-Signing Practice
Goldman Sachs, Ocwen Financial Corp. and Litton Loan Servicing will end robo-signing practices and write down as much as $53 million in unpaid principal on New York mortgages as part of an eight-point agreement with an Empire State regulator.
In addition, Goldman will forgive 25 percent of the principal balance on New York home loans 60 days or more past due serviced by Litton and owned by Goldman as of Aug. 1. The investment banking giant, which is exiting the mortgage servicing business with the sale of Litton, will adopt these servicing practices if it should re-enter the servicing industry.
New York's Superintendent of Financial Services Benjamin Lawsky said Thursday that the settlement was implemented "as a condition to allowing Ocwen's acquisition of Goldman Sachs' mortgage servicing subsidiary, Litton." When the two servicing firms merge, Ocwen will become the nation's 12th largest mortgage servicer.
Goldman Sachs declined to comment Thursday and representatives for the two mortgage servicers could not be reached for comment.
Robo-signing, a controversial practice that involves the mass signing of mortgage documents without review, has been under fire since last year when foreclosure moratoriums were implemented nationwide to ensure all documents receive the appropriate review.
Read the full story at HousingWire.
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