Regulators sue Ocwen Financial, say it mishandled mortgages

by Frankie Norman April 22, 2017, 0:30
Regulators sue Ocwen Financial, say it mishandled mortgages

"We can not allow this to continue". "The CFPB suit is primarily based on the CFPB's flawed review of data and its self-serving conclusion about isolated instances where Ocwen self-identified ways we can do better".

The actions by the federal and state governments are the latest black eye for Ocwen, which grew to become one of the nation's largest nonbank mortgage servicing firms after the housing crash but has been swamped by regulatory problems and consumer complaints.

U.S. Bancorp (NYSE:USB) after beginning at $49.79, closed at $50.68 by building up +1.99% in recent trading session.

State and federal agencies on Thursday filed lawsuits against Ocwen Financial Corp., accusing the West Palm Beach-based company and its subsidiaries of repeated mortgage-servicing abuses.

An issue of Ocwen Financial Corp (NYSE:OCN) debt fell 18% as a percentage of its face value during trading on Thursday.

Some of the alleged failings cited by the CFPB focused on the REALServicing technology system Ocwen used to handle its servicing of mortgage loans. They actually propagated that they are working on improving the loan terms, which will help the borrowers to stay in their homes.

You may have read stories this week about loan servicing company Ocwen Financial Corp. The company's alleged failures also led to lapsed homeowners' insurance coverage for more than 10,000 borrowers, the regulator said. In those cases, they said, Ocwen sometimes foreclosed before reviewing borrowers' applications for loss mitigation.

— Illegally foreclosed on at least 1,000 people.

In another foreclosure issue, the company allegedly failed to assist heirs who were seeking foreclosure alternatives. "Indeed, Ocwen continued to work with the CFPB until the suit was filed".

The Department of Banking and Finance is available to assist consumers who now make mortgage payments to Ocwen, in the event those consumers experience problems with payments or other account issues.

The News Tribune's attempts to reach someone at Ocwen this week were not successful.

Mortgage escrow accounts are utilized to pay taxes and insurance and hold borrower funds the company is entrusted to manage appropriately. State Street Corp now owns 1,836,727 shares of the financial services provider's stock worth $9,901,000 after buying an additional 91,782 shares during the period. The New York Department of Financial Services and CFPB had already launched an investigation on Ocwen in 2014.

Regulators said when consumers complained to Ocwen, the company routinely failed to acknowledge or investigate the consumers' complaints.

"I know there's no shot in hell, but if I could change systems tomorrow, I would", the executive wrote, according to the lawsuit. The company is under fire in a lawsuit by state and federal regulators who say the company mishandled millions of mortgage accounts.

Since April 2015, Ocwen has received more than 580,000 notices of error and complaints from more than 300,000 different borrowers, the Bureau alleges. No mortgage servicer is ideal - to the extent mistakes are made, we have a process to identify and remediate consistent with other mortgage servicers. The company maintains that the opposite of what CFPB claims is actually true. This, in turn, hindered the new servicers' efforts to comply with laws and investor guidelines.

The CFPB did not announce what type of financial penalty it was hoping to achieve in its lawsuit. The CFPB's complaint, filed today, alleged the Ocwen "engaged in significant and systemic misconduct at almost every stage of the mortgage servicing process".

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