Goldman Sachs and two other firms have agreed with the New York banking regulator to end the practice known as robo-signing, in which bank employees signed foreclosure documents without reviewing case files as required by law, the Wall Street Journal said.

In an agreement with New York's financial-services superintendent, Goldman, its Litton Loan Servicing unit and Ocwen Financial Corp also agreed to scrutinize loan files for evidence they mishandled borrowers' paperwork and to cut mortgage payments for some New York homeowners, the Journal said.

The agreement, expected to be announced Thursday, could provide a blueprint for other regulators as they pursue settlements with the largest U.S. banks over allegations they failed to properly handle home loans, the newspaper said, citing people familiar with the matter.

Goldman and Ocwen could not immediately be reached by Reuters for comment outside regular U.S. business hours.

Litton, a provider of servicing and subservicing of primarily non-prime residential mortgage loans, is in the process of being acquired by Ocwen for $264 million.

(Reporting by Sakthi Prasad in Bangalore; Editing by Vinu Pilakkott)

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