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Full Compliance Deadline For U.S. Mortgage Settlement Standards Now In Effect

nmslogo.pngAll five major lenders involved in the National Mortgage Settlement now must be in full compliance with the agreement’s rules to prevent “robo-signing”— the widespread improper notarization and document signing abuses that caused the national foreclosure crisis — and more banks are negotiating settlements to resolve claims of wrongdoing.

As part of the settlement with federal officials and state Attorneys General, the five lenders agreed to major reforms in how mortgage loans are serviced, such as allowing borrowers to see all loan documents to make sure a potential foreclosure is legal, and giving borrowers the opportunity to modify loans before facing foreclosure. Mortgage servicers and their third party vendors must also now keep a record of foreclosure-related notarial acts.

Along with these new requirements, Notary Signing Agents are also beginning to see a new form used at closings to record and track notarization information in addition to standard journal entries. Officials are also working on similar agreements with regional banks to reform their practices and comply with the new foreclosure standards.

Additional information on the terms of the settlement is available at the National Mortgage Settlement official site. Members of our Notary Signing Agent Section are invited to discuss loan document issues and concerns at the Section LinkedIn discussion group.

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