The deal between state attorneys general and servicers may resolve some of the legacy robo-signing and mortgage documentation issues, but private residential mortgage backed securities investors are upset and confused.

After all, they provide the market with much needed capital and feel no responsibility for anything to do with the poor practices of servicers, underwriters and lenders. Still, they will be the ones taking a haircut on principal reductions for certain homeowners under the settlement.

The Association of Mortgage Investors is in a holding pattern, waiting to see what trusts are impacted by the settlement, but the writing is on the wall. Mortgage investors wanted to be consulted in a transparent fashion, and they feel hurt by the deal, or at least by the lack of details released to date.

While the settlement may resolve mortgage servicing issues and be good news for certain parts of the market, the future is not looking so bright if these same parties want more privately funded mortgages.

The AG settlement resolves robo-singing in a way that shows investors are not greatly considered in resolutions of the nation's housing woes. Not a good thing, as the nation needs their money in order to keep the mortgage finance industry going.

So it's probably not the best idea to give them even more reason to take their business elsewhere.