$2 Billion in principal reduction
$125 Million in cash to foreclosed homeowners
Modeled on National Mortgage Settlement
The Consumer Financial Protection Bureau (CFPB), together with attorneys general and state banking regulators in 49 states, and the District of Columbia have filed a proposed court order requiring the largest nonbank mortgage loan servicer in the country, Ocwen Financial Corporation, and its subsidiary, Ocwen Loan Servicing, to provide $2 billion in first lien principal reduction to underwater borrowers.
The consent order addresses Ocwen’s misconduct during the mortgage servicing process. It also covers two companies previously purchased by Ocwen, Litton Loan Servicing LP (“Litton”) and Homeward Residential Holdings LLC (previously known as American Home Mortgage Servicing, Inc. or AHMSI). Ocwen must also refund $125 million to the nearly 185,000 Ocwen, Litton, and Homeward borrowers who have already been foreclosed upon and Ocwen must adhere to significant new homeowner protections.
The consent order requires that Ocwen follow the servicing standards set up by the 2012 National Mortgage Settlement (NMS) with the five largest banks. Ocwen’s compliance with this settlement will be monitored by the same professional monitoring team currently in charge of enforcing the NMS, led by former North Carolina Banking Commissioner Joe Smith.
Further information concerning the Ocwen settlement is available here:
A factsheet about the proposed order filed today:
http://files.consumerfinance.gov/f/201312_cfpb_factsheet_ocwen.pdf
Common consumer questions and answers about the order:
http://files.consumerfinance.gov/f/201312_cfpb_common-questions_ocwen.pdf
A copy of the Ocwen complaint that the CFPB and state attorneys general filed today:
http://files.consumerfinance.gov/f/201312_cfpb_complaint_ocwen.pdf
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