Lender Processing Services and a couple of its subsidiaries have admitted in a multi-state settlement that mortgage foreclosure documents contain false signatures and those documents were falsely notarized. As a part of the settlement, the company and its subsidiaries are banned from participating in these types of "shoddy practices" when conducting foreclosures. New Jersey will receive approximately $3.1 million of the $127 million settlement, and this may help some people stop foreclosure.
The settlement funds are being divided among the 46 states that participated in bringing the allegations against Lender Processing Services and its subsidiaries. LPS will be reviewing documents executed from 2008 through 2010 to see if there are any errors that need to be corrected. The settlement also bars LPS from forcing attorneys to sacrifice accuracy for speed.
This settlement comes on the heels of another settlement with five lenders last year. New Jersey received approximately $75 million from that settlement. That settlement involved, among other things, the signing of unverified legal documents. The number of New Jersey homeowners that will benefit from this new settlement may not be known for several months.
Many people are still facing foreclosure despite these settlements and the continuing efforts of those homeowners. For them, bankruptcy may be a way to deal with their mortgage dilemma responsibly. Filing for bankruptcy could give homeowners the time and space they need to make some decisions regarding their home and any other debt. For some homeowners that pursue Chapter 13 reorganization, it could be the chance to stop foreclosure and keep their home. Others may decide that it is time to walk away from their home and achieve a fresh financial start.
Source: northJersey.com, "NJ to get $3 million in settlement over foreclosure abuses," Kathleen Lynn, Jan. 31, 2013