Ocwen Financial Corp.’s (NYSE:OCN) $2.7 billion agreement to buy mortgage servicing rights to around 184,000 loans has been put on ice.
New York’s Department of Financial Services has “indefinitely” halted Ocwen’s agreement to buy the rights to service $39 billion of loans from Wells Fargo, the Atlanta-based mortgage servicer announced in early February.
The roadblock stems from ongoing investigations into Ocwen, the parent company of Liberty Home Equity Solutions, regarding alleged misconduct toward homeowners in its existing MSR portfolio and concerns the mortgage servicer wouldn’t be able to properly handle additional loans given those allegations, the Wall Street Journal reports.
“Ocwen will continue to work closely with the NY DFS to resolve its concerns about Ocwen’s servicing portfolio growth,” the company said in a statement.
Other speciality mortgage servicers with reverse mortgage industry holdings who have been buying up MSRs include Walter Investment Management Corp. (NYSE:WAC) and Nationstar Mortgage Holdings (NYSE:NSM).
Written by Alyssa Gerace