Lender Processing Services (LPS) Chief Financial Officer Tom Schilling said in a conference call with investors Wednesday that the negotiations with the remaining state attorneys general is moving toward resolution. “We can’t get into a lot of the details, but we’re happy with the progress made in the last 90 days to bring that to a head,” Schilling said. “I think there is more clarity now than there was 90 days ago.” New York AG Eric Schneiderman said Tuesday night he expects a “meaningful resolution” to the problems. The largest mortgage servicers and LPS were found to be signing large numbers of foreclosure-related affidavits and misfiling them with state courts around the country in October 2010. Since then, the combined investigative force of federal regulators, state supervisors and the AGs fractured, resulting in a series of consent orders, negotiation panels and even possible felony charges. DocX, owned by LPS, prepared and executed assignments of mortgage and lien releases, but has since been shut down. The documents DocX handled were found to be signed en masse and by several unauthorized employees. The firm faces an ongoing lawsuit with LPS client American Home Mortgage Servicing, which Schilling said should be resolved through arbitration and is currently being negotiated. “We’re in conversations with a number of the states,” Schilling said. “We hope to bring those to a head sooner rather or later. It’s not the easiest process to manage. We may have an approach that may bring some of this stuff to a head.” In an interesting twist, LPS is seeing increased revenue from the mortgage servicing problems, especially from the consent orders, as the largest servicers deal with new regulations, Hugh Harris, the new CEO of LPS, said the company re-directed more than 200 employees toward compliance alone. Its technology division houses the mortgage servicing desktop software the largest mortgage firms in the country use to service 80% of the mortgages outstanding in the U.S. While LPS third-quarter earnings were cut in half from a year earlier, this division saw revenue rise 3% to $193.7 million. “The regulatory environment is creating opportunities for us more so than handcuffing us,” Harris said. Schilling clarified that the consent orders from the largest regulators may actually affect the industry more, but as soon as both these new rules and the settlement are cleared, the foreclosure process will restart and the market can move more quickly through its crippling inventory. When asked for a specific resolution date the settlement, Schilling said he didn’t know. “Sitting here in October 2011, we’re well passed what everyone thought it would reasonably take,” he said. Write to Jon Prior. Follow him on Twitter @JonAPrior.

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