Goldman Sachs can complete the sale of its mortgage servicing subsidiary to Ocwen Financial Corp. now that the parties have agreed to a settlement with the New York superintendent of banks over alleged abusive services practices, according to a report in The Wall Street Journal.
Under the agreement, Goldman's Litton Loan Servicing division and Ocwen have agreed to stop the practice of robo-signing mortgage documents and to review their loan files for such violations.
As part of the settlement, Goldman agreed to make a 25% principal reduction on 143 New York mortgage loans.
The New York Banking Department could not to be reached for comment Thursday morning.
Banking superintendent Benjamin Lawsky is expected to make an announcement about the settlement today.
Among subprime servicers, Ocwen ranks third nationwide with $55 billion of MSRs, according to figures compiled by ASR's sister publication, National Mortgage News and the Quarterly Data Report. Litton ranks fifth with $42 billion.
