Litton Loan Servicing, the nation's fifth largest servicer of subprime mortgages, said it will halt certain foreclosures to review how its processes these delinquent loans.
"Litton Loan Servicing has suspended foreclosure proceedings in certain cases while it completes a review of its procedures," a spokeswoman for the Goldman Sachs-owned said in a statement to the press.
On Tuesday morning a Goldman spokesman had no comment on the matter, referring all media inquiries to Litton. At press time Litton had not returned a telephone call.
According to figures compiled by National Mortgage News and the Quarterly Data Report, Litton ranks fifth nationwide among subprime servicers with $52.5 billion in receivables on its books. Roughly $4 billion of that is in the form of subservicing contracts.
Goldman bought the Houston based servicer/subservicer in late 2007 from the struggling Credit-Based Asset Servicing and Securitization (C-BASS). C-BASS was owned by two mortgage insurance companies, MGIC and Radian.
Sources told National Mortgage News that Goldman bought Litton at a steep discount and even considered selling the firm as recently as a year ago.