Mortgage Settlement Funds Earmarked

Allison Tussey —  November 2, 2012 — 2 Comments

Lender Processing Services, Inc. settled a dispute for past document execution practices by LPS subsidiaries DocX, LLC and LPS Default Solutions, Inc., the funds from which are now earmarked. Florida-based LPS provides technology and other services to mortgage loan servicers.

During a period from January 1, 2008 to December 31, 2010, certain residential mortgage loan servicers authorized specific persons employed by LPS subsidiaries DocX and LPS Default Solutions to sign or assist with the execution of mortgage-related documents, including lost instrument affidavits, deed of trust lien releases, and assignments of deeds of trust. Some of the mortgage-related documents generated or executed by LPS subsidiaries contained defects such as unauthorized signatures and improper notarizations.

Between March 1, 2009 and November 1, 2009, employees and agents of DocX were directed by management of DocX to implement a program under which some DocX employees signed mortgage-related documents in the name of other DocX employees, who were or had been at one time authorized to sign on behalf of certain mortgage servicers. DocX referred to these signers as “surrogate signers,” who then executed certain mortgage-related documents in the name of other DocX employees without indicating that the document had been signed by a surrogate signer.

As part of the settlement, LPS and its subsidiaries agree not to engage in any surrogate signing program or execute any mortgage-related documents without an affiant’s review and personal knowledge of the accuracy and completeness of the statements in the documents. LPS and its subsidiaries also will ensure that any mortgage-related document that is executed on behalf of a servicer is done pursuant to proper and verifiable authority to sign on behalf of the servicer.

Colorado Attorney General John Suthers announced the amount of settlement proceeds directed to Colorado.

The State of Colorado will receive $1.8 million as part of the settlement.

The settlement funds will be used for programs related to foreclosure prevention, loan modification and housing, to reimburse the Colorado Attorney General’s Office for its attorney fees and costs, and for future consumer protection and antitrust enforcement and education efforts in the state.

“This settlement with LPS is part of our on-going investigation into all facets of the foreclosure process in Colorado,” said Suthers. “It is important that the foreclosure process work as intended and that borrowers and the legal system have confidence in it.”

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2 responses to Mortgage Settlement Funds Earmarked

  1. John and Janet Varne June 5, 2013 at 8:05 am

    Please inform me if the money for the DOCX settlement ? Our first mortgage sold our loan from M&I then to Bear Stearns in 2006. Received Original Note and Deed of Trust from DOCX but somehow after paying half down and 3 years without a missed payment
    we lost our home to foreclosure one year ago on the 19th of June 2012.

    Thanks,
    John and Janet Varnes

  2. Janet and John Varnes June 26, 2013 at 4:54 am

    DocX’s sent us our original note and Deed of Trust in Jefferson County Colorado … Eventual lost of home along with our large down payment. Who can we speak to… and how can we turn over evidence to prove our case?

    Thank you in advance for all you do !!!!

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