Ocwen’s mortgage servicing failings will cost it big bucks.
The Attorneys General of the states and the CFPB have reached a settlement with Ocwen regarding its misconduct as a mortgage loan servicer.
Ocwen must provide $2 billion in principal reductions to borrowers, along with cash to those who were victimized in the course of a foreclosure. More about the terms of the settlement.
Going forward, Ocwen’s servicing practices will be subject to monitoring akin to that done of the five major banks who settled earlier with the law enforcement coalition.
Alleged violations
The complaint against Ocwen alleged that it took advantage of homeowners with improper shortcuts and unauthorized fees; that it improperly denied loan modfications, and that it engaged in illegal forclosure practices.
The settlement covers both Ocwen and two other servicers it recently bought: Homeward Residential Holdings and Litton Loan Servicing.
Homeward did business as American Home Mortgage Servicing.
Loan modification relief
Part of Ocwen’s committment under this settlement is to provide $2 billion in principal reductions to borrowers through loan modifications.
Eligible borrowers may be contacted directly by Ocwen. Or you may contact Ocwen to obtain more information about specific loan modification programs and to find out if you are covered by this settlement. Ocwen can be reached at [email protected] or 1-800-337-6695.
Foreclosure victims
You may be eligible for a cash award if you meet these criteria:
- your home was foreclosed on between January 1, 2009 and December 31,2012;
- at the time of foreclosure, the loan was serviced by Ocwen, Homeward, or Litton;
- you lived or intended to live in the property as your principal place of residence at the time of the origination of the loan;
- the property was a one-to-four unit residential property;
- the unpaid principal balance of the first-lien did not exceed $729,750 for a one-unit property, $934,200 for a two-unit property, $1,129,250 for a three unit property, or $1,403,400 for a four-unit property; and
- you make a valid claim.
The settlement administrator will notify eligible borrowers. Or, you can contact your Attorney General’s office to be added to their list at your current address.
I’ll follow this story here as it develops .
Image courtesy of Flickr and Alan/Falcon
