Regulators sue Ocwen Financial, say it mishandled mortgages

Ocwen Hit With Several Cease-And-Desist Letters From State Regulators

Ocwen Hit With Several Cease-And-Desist Letters From State Regulators

Ocwen will not sign unfair and unjust consent orders that make impractical demands that no other market participant could rationally accept, and which would harm consumers. Common complaints include whether the escrow account is being properly handled and suspect foreclosure activities, he said.

The majority of Ocwen's loan servicing portfolio represents distressed credit, sometimes referred to as troubled borrowers.

The CFPB filed its complaint in the U.S. District Court for the Southern District of Florida.

Ocwen Financial Corporation is diversified financial services holding company.

Many consumers have complained to the state about Ocwen since The News Tribune revealed one Tacoma man's trouble with the mortgage servicer in 2012. "Ocwen strongly disputes the CFPB's claim that Ocwen's mortgage loan servicing practices have caused substantial consumer harm". The Company's primary businesses are the acquisition, servicing, and resolution of sub-performing and nonperforming residential and commercial mortgage loans, as well as the related development of loan servicing technology and business-to-business e-commerce solutions for the mortgage and real estate industries. Indeed, the company is unaware of the CFPB conducting any detailed review of Ocwen's loan servicing files.

"Ocwen has repeatedly made mistakes and taken shortcuts at every stage of the mortgage servicing process, costing some consumers money and others their homes", CFPB Director Richard Cordray said in a statement.

The CFPB's announcement lists a variety of other alleged failures including failing to credit borrowers' payments, botching escrow accounts, mishandling hazard insurance and bungling borrowers' private mortgage insurance.

"I know there's no shot in hell, but if I could change systems tomorrow I would", added the employee, who was not identified by name in the lawsuit.

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Ocwen is also accused of operating "unlicensed mortgage servicing facilities in certain states in apparent violation of state licensing statutes over a period of several years".

Ocwen said it would respond to the state mortgage regulators after reviewing their orders.

Diane Wynn of Queens, New York, was equally perplexed when she learned last March that Ocwen was foreclosing on her home.

"It's absolutely insane that they approved a foreclosure after they had already approved her for a modification", said Aisha A. Baruni, a staff attorney with Queens Legal Services. In other cases, Ocwen would ask borrowers to submit additional information within 30 days, but would begin the foreclosure process before that deadline was up.

The story of Ocwen, founded in 1988, is one of rapid growth.

The cease-and-desist order states that the Multi-State Mortgage Committee, a committee of state mortgage regulators, agreed to address their enforcement actions in a "collective and coordinated manner". In an extraordinary move, William C. Erbey, the company's founder, stepped down as chairman as part of the deal. Ocwen Financial Corp has a 12-month low of $1.29 and a 12-month high of $6.15.

Licensing - Ocwen has worked diligently to correct perceived licensing concerns and has entered into recent settlements with three states, without admitting or denying wrongdoing. Ocwen Financial Corp's revenue for the quarter was down 10.6% on a year-over-year basis.

Thanks for your continued support.. Keefe, Bruyette & Woods reaffirmed a "hold" rating and issued a $5.00 price target on shares of Ocwen Financial Corp in a research report on Monday, April 10th.