Goldman Says It's "Exploring Strategic Options For Litton Loan..." As It Begins Effort To Wash Hands Of Mortgage Servicing Unit

Bloomberg reports:

• Goldman Sachs Group Inc., the fifth-biggest U.S. bank by assets, said it’s trying to sell Litton Loan Servicing LP, the Houston-based mortgage-servicing unit it acquired more than three years ago. “Goldman Sachs is exploring strategic options for Litton Loan Servicing, which include a possible sale,” Michael DuVally, a spokesman in New York, said in a telephone interview.

• The company bought Litton in December 2007 as investors including billionaire Wilbur Ross and Centerbridge Capital Partners LLC purchased mortgage servicers to help them better understand the market and profit from buying discounted loans. Goldman Sachs is selling after failing to find enough opportunities to buy distressed mortgage loans, said a person familiar with the situation.

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• Since Goldman Sachs bought Litton, the value of the company’s mortgage-servicing rights has also evaporated. By the end of 2009, Goldman Sachs’s estimate for the fair value of the rights had dropped to $88 million from $283 million at the end of February 2008, according to regulatory filings.

For more, see Goldman Sachs Seeking to Sell Litton Mortgage-Servicing Unit.

See also, Business Insider: Why Goldman Sachs Wants To Get Rid Of Its Home Loan Servicing Unit ASAP:

• Goldman is reportedly considering selling its loan servicing unit. Litton Loan Servicing, which Goldman bought in 2007, has been a headache for at least a year, in one instance because people complained about the ethics of unit's business practices.