CFPB orders Ocwen Financial to pay $2B

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Dec. 23, 2013 – The CFPB along with 49 states and D.C. filed a proposed court order on Thursday for Ocwen Financial Corporation to pay $2 billion to underwater homeowners, as well as $125 million to the almost 185,000 borrowers who have already been foreclosed upon, in light of its misconduct.

“The consent order addresses Ocwen’s systemic misconduct at every stage of the mortgage servicing process,” according to the CFPB. The order applies to Ocwen and its subsidiary Ocwen Loan Servicing.

Ocwen, based in Atlanta, is the largest nonbank mortgage servicer and fourth-largest overall servicer in the country, and specializes in subprime loans. The CFPB is charging Ocwen with multiple violations, including but not limited to:
  • Not keeping accurate account statements;
  • Charging unauthorized fees;
  • Giving consumers false or misleading information in response to complaints;
  • Giving consumers false or misleading reasons for denying loan modifications; and,
  • Misleading or lying to consumers about the status of foreclosure proceedings.
The order also requires Ocwen to stop the practice of robo-signing official documents, which it did without ensuring the facts in the documents relating to foreclosures and bankruptcies are accurate.

Bureau Director Richard Cordray said, “Ocwen took advantage of borrowers at every stage of the process. Today’s action sends a clear message that we will be vigilant about making sure that consumers are treated with the respect, dignity, and fairness they deserve.”

The CFPB issued new rules governing mortgage servicing in January, which will be effective next month.

Related Links:
CFPB release