WASHINGTON, DC – The District of Columbia will get a $232,505 share of a multi-million-dollar settlement reached by the District and 45 states with Florida-based Lender Processing Services, Inc., to resolve allegations that the company prepared defective documents for use in foreclosure processes, District of Columbia Attorney General Irvin B. Nathan announced today.
In a complaint filed today in DC Superior Court, the District alleges that Lending Processing Services’ practices contributed to faulty residential-foreclosure processes, especially during the height of the foreclosure crisis from 2008 through 2010.
LPS agreed to a consent judgment governing how it prepares and executes documents for use in foreclosure processes. Among other things, the consent judgment:
- Requires LPS to have the authority to sign documents on behalf of a mortgage servicer;
- Prohibits LPS from notarizing documents outside the presence of a notary and requires that LPS’s notary procedures comply with all applicable laws;
- Prohibits LPS from paying volume-based incentives to its employees and agents for the purpose of encouraging speed over accuracy in document preparation;
- Requires LPS to properly monitor third parties that it retains to perform default-related services.
In addition, LPS is required to undertake a review of the mortgage loan documents it executed during 2008-2010 and to identify any documents that need to be re-executed or corrected. LPS will set up a toll-free number for consumers to request review and correction of LPS-executed documents.
“This global settlement corrects a wide range of past abusive and prejudicial practices,” Attorney General Nathan said. “We will not allow the legal rights of DC homeowners to be jeopardized by sloppy and inaccurate foreclosure-related work.”
The District’s settlement share is based on company revenue that was derived from document-preparation services pertaining to DC homes.
- Ted Gest (202) 727-6283