Servicer Settlement Terms Released to Public

The 27-page document that was sent to major banks last week by the 50-state group of attorney generals is now publicly available. 

The letter outlines terms for a settlement expected to be worked out between the group and the banks' mortgage servicers to stop litigation and correct flaws in the system that became apparent as servicers moved from the routine handling of performing loans to managing a scenario of rapidly rising delinquencies and skyrocketing foreclosures.

The document covers a wide variety of topics relating to the relationship between servicers and borrowers, servicers and investors, and servicers and various regulatory groups and is specific in its recommendations across a range of concerns.  For example, servicers, especially in non-judicial states where legal guidance may be lacking are required to prepare affidavits and swear to their accuracy based on personal knowledge or review of loan documents.  The servicer must also correct any improper filings and notify the borrower if deficiencies have been noted in any part of the document preparation.  Servicers will also be required to verify the accuracy of a borrower's account information and be able to properly identify and document the note holder.

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Source: http://www.mortgagenewsdaily.com/03082011_loan_servicing.asp

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