Ocwen Inks Deals with 10 States to Restore Servicing Rights

Just one day after Illinois and Montana announced agreements with Ocwen Financial Corporation (NYSE: OCN) to lift mortgage servicing and origination restrictions, the servicer made deals with eight other states.

The West Palm Beach, Fla.-based Ocwen now has a path out of bans in Georgia, Idaho, Maine, Michigan, Mississippi, Rhode Island, South Carolina, and Wisconsin, according to an 8-K form filed early Friday morning.

Under the terms of the agreements, Ocwen can resume the acquisition of mortgage servicing rights (MSRs) in the states on April 30, and will replace its troubled REALServicing platform with a new program. The company, which services and originates reverse mortgages through its Liberty Home Equity Solutions subsidiary, must also work with third-party auditors to perform an escrow review on a representative sample of loans in its existing portfolio.

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Ocwen did not admit or deny liability for the alleged issues as part of the deals.

Back in April, 21 states plus the District of Columbia slapped Ocwen with cease-and-desist orders stemming from the improper handling of escrow accounts and failure to provide certain information about its financials. Aside from the 10 jurisdictions that have already agreed to lift the bans, Nevada and Indiana have either let the bans lapse or withdrew their complaints.

Only in Illinois did the ban apply to Liberty, though officials told RMD at the time that the move was designed to prevent the company from issuing forward mortgages through its other subsidiaries, and not a direct order to shut down its reverse mortgage originations in the state.

Ocwen is actively working with the remaining state authorities to reach similar agreements, the company said.

“Ocwen is pleased to have reached mutually-agreeable resolutions with 12 states to resolve regulatory actions brought against the company in April 2017,” company spokesman John Lovallo said in a statement.

“We look forward to productive relationships with all regulatory bodies, and to continue our mission of helping homeowners, especially those struggling to remain in their homes,” Lovallo said.

Written by Alex Spanko