Lender Processing Services Shares Plunged: What You Need to Know
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What: Shares of mortgage processer Lender Processing Services (NYS: LPS) are getting foreclosed on today, down by as much as 17%, after the Nevada attorney general sued the company.
So what: Attorney General Catherine Cortez Masto alleges that Lender Processing Services falsified foreclosure documents and demanded kickbacks for referrals. Masto said the company engaged in robo-signing, which resulted in erroneous foreclosures.
Now what: Nevada has seen the highest foreclosure rates in the nation for almost five straight years, and due to LPS and its error-prone processing, many foreclosures proceeded under false pretenses. Masto said robo-signing in the state has been spurred on by chaos and speed, and she seeks to "protect the integrity of the foreclosure process." The news is evidence that even though the economy is technically in recovery mode, the slow housing market is still having fallout all over the place.
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At the time this article was published Fool contributorEvan Niuholds no position in any company mentioned.Click hereto see his holdings and a short bio. The Motley Fool has sold shares of Lender Processing Services short. Try any of our Foolish newsletter servicesfree for 30 days. We Fools may not all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. The Motley Fool has adisclosure policy.