Lender Processing Services Shares Plunged: What You Need to Know

Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.

What: Shares of mortgage processer Lender Processing Services (NYSE: 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.

Interested in more info on Lender Processing Services? Add it to your watchlist by clicking here.

Fool contributor Evan Niu holds no position in any company mentioned. Click here to see his holdings and a short bio. The Motley Fool has sold shares of Lender Processing Services short. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.


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  • Report this Comment On December 17, 2011, at 1:38 AM, seanbaber wrote:

    To find a great refinance rate, you should talk to at least one national mortgage lender, one local lender, a credit union and 123 Refinance. Also ask your friends which bankers and brokers they have used.

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