Mortgage servicer Ocwen has joined the list of major lenders and servicers who have agreed to slash mortgages for struggling homeowners. Ocwen agreed to reduce $2 billion in principle for struggling homeowners over a three year period, and pay $67 million in cash settlements to individuals who were wrongly displaced from their homes during foreclosure.
The deal was reached as a settlement with federal and state authorities over accusations of deceptive mortgage servicing. The complaint against Ocwen alleged that it engaged in improper shortcuts, imposed unauthorized fees, improperly denied loan modifications, and engaged in illegal foreclosure practices with homeowners. The agreement did not admit any admission of wrongdoing on the part of Ocwen, and there were no criminal charges levied against executives. The settlement includes any wrongdoing by two mortgage servicing companies recently acquired by Ocwen: Homeward Residential Holdings (aka American Home Mortage Servicing) and Litton Loan Servicing.
“We believe Ocwen violated federal consumer financial laws at every stage of the mortgage servicing process,” said Richard Cordray, director of the Consumer Financial Protection Bureau (CFPB). “After examining the potential violations, we have concluded that Ocwen made troubled borrowers more vulnerable to foreclosure.”
Individuals who were foreclosed on between January 1, 2009, and December 31, 2012, may be sent a cash payment. Those eligible to receive payment or mortgage relief will receive notification directly from settlement administrators. More information and qualifying conditions is available on the CFPB website, here. You may also contact your Attorney General’s office and add your name to the contact list for your current address. To find your state’s Attoroney General, click here.