first_img Share in Featured, News, Servicing January 23, 2015 614 Views Updated with more information and an update about the California Department of Business Oversight.A group of mortgage bond investors has sent Ocwen Financial Corp. a notice of non-performance in what could be the precursor toward a future lawsuit, according to a media report.Citing an unnamed source, Reuters reported Friday afternoon that a number of major investors, including BlackRock, MetLife, and Pimco, filed a formal notice to Ocwen accusing the servicer of failing to properly collect payments on $82 billion of home loans.In a public release, law firm Gibbs & Bruns LLP said a “lengthy investigation and analysis by independent, highly qualified experts” turned up multiple instances of Ocwen’s failure to perform, including use of trust funds to pay borrower relief obligations through modifications on trust-owned mortgages; conflicts of interest with affiliate companies; failure to maintain adequate records and communications with borrowers; and “[e]ngaging in imprudent and wholly improper loan modification, advancing, and advance recovery practices;” among others.As a result, the group says the trusts took losses of more than $1 billion.In a public response issued Monday, Ocwen denied the investors’ claims, accusing them of engaging in an “ill-conceived effort to push foreclosures and stop principal reduction … [as] part of their ongoing industry-wide pro-foreclosure campaign.””While knee-jerk foreclosures may redound to the special economic interests of your clients, they are not in the best interests of the Trusts as a whole, not consistent with industry practice, and therefore prohibited under the servicing agreements,” the company said.The investors’ dissatisfaction comes as more bad news to Ocwen, one of the biggest mortgage servicers in the United States.After closing the book on nearly a year of operational probes with a $150 million settlement, the Atlanta-based firm took another hit earlier this month, when the California Department of Business Oversight (DBO) said it was seeking to suspend the company’s mortgage license in the state. DBO spokesperson Tom Dresslar said the state sought the suspension after Ocwen failed to provide adequate proof of compliance with California’s Homeowner Bill of Rights.Shortly after Friday’s news broke, the department released a statement announcing a $2.5 million settlement with the company.Under the terms of that agreement, Ocwen is also barred from taking on any new customers in the state until the regulator determines that it “can fully respond in a timely manner to future requests for information.”The company also agreed to pay for an independent, third-party auditor to be selected by the DBO. That auditor will review Ocwen’s loan file information and submit a report on its compliance with state and federal regulations.”The Department is committed to supporting a fair and secure financial services marketplace for all California consumers,” said DBO Commissioner Jan Lynn Owen. “This settlement allows us to move forward and ensure that Ocwen is meeting its obligations under the law.”center_img Report: Investors Move Toward Potential Ocwen Lawsuit Ocwen 2015-01-23 Tory Barringerlast_img

Report Investors Move Toward Potential Ocwen Lawsuit

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