December 19, 2013
Principal Reductions, Cash Payments to Foreclosed Borrowers, and Tough Mortgage Servicing Standards Hold Ocwen Accountable for Past Practices
Las Vegas, NV – Nevada Attorney General Catherine Cortez Masto announces Ocwen Financial Corporation of Atlanta, Ga., and its subsidiary, Ocwen Loan Servicing, have agreed to a $2.1 billion dollar joint state-federal settlement with Attorney General Catherine Cortez Masto, 48 additional states and the District of Columbia, and the Consumer Financial Protection Bureau (CFPB).
“This is part of our ongoing civil law enforcement effort to hold servicers accountable,” said Masto. “We will continue to take every precaution to protect Nevada homeowners.”
The misconduct resulted in premature and unauthorized foreclosures, violations of homeowners’ rights and protections, and the use of false and deceptive documents and affidavits, including “robo-signing."
In Nevada, Ocwen will provide troubled borrowers with an estimated $32,706,241 million in first lien principal reductions, and loans will be eligible to receive a cash payment. The payment amount, which is contingent on the number of consumers who submit valid claims, is projected to exceed $1,000.
Ocwen Agreement Highlights
- Ocwen commits to $2 billion in first-lien principal reduction.
- Ocwen pays $125 million cash to borrowers associated with 183,984 foreclosed loans.
- Homeowners receive comprehensive new protections from new mortgage loan servicing and foreclosure standards.
- An independent monitor (Joseph A. Smith, Jr., Monitor of the National Mortgage Settlement) will oversee implementation of the settlement through the Office of Mortgage Settlement Oversight to ensure compliance.
- The government can pursue civil claims outside of the agreement, and any criminal case; borrowers and investors can pursue individual, institutional or class action cases regardless of the agreement.
- Ocwen pays $2.3 million for settlement administration costs.
The final agreement, through a consent judgment, will be filed in U.S. District Court in Washington, D.C. If approved by a judge, it will have the authority of a court order.
Because of the complexity of the mortgage market and this agreement, which will span a three year period, in some cases Ocwen will contact borrowers directly regarding principal reductions. However, borrowers should contact Ocwen to obtain more information about principal reductions and whether they qualify under terms of this settlement.
More information will be made available as the settlement programs are implemented.
Make Home Ownership a Reality with Home Again Nevada:
Nevada homeowners can also seek assistance through the Attorney General sponsored Home Again, Nevada Homeowner Relief Program that makes it easier to determine what state or federal assistance may be available to them. For more information contact 1-855-HLP4NEV (1-855-457-4638) or visit the website: http://www.homeagainnevada.gov. Home Again is open to all Nevadans, but is designed specifically to help those working toward homeownership, individuals seeking to restore their credit, and homeowners interested in identifying what state and federal assistance may be available.
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