Public Information Officer
WASHINGTON, D.C. – D.C. homeowners will receive mortgage principal reductions estimated at $7 million under a national settlement that state and federal enforcement agencies have reached with mortgage servicer Ocwen Financial Corporation of Atlanta, Georgia, and its subsidiary, Ocwen Loan Servicing, Attorney General Irvin B. Nathan said today.
The national settlement is valued at $2.1 billion. Under the settlement, Ocwen will provide homeowners with $2 billion in first-lien principal reductions, and will provide $125 million in cash payments to borrowers whose homes were foreclosed.
The total amount of relief for D.C. homeowners will depend on their rate of participation in Ocwen’s principal reduction program, which will be implemented nationally. In addition, 118 D.C. homeowners who lost their homes to foreclosure between January 1, 2009 and December 31, 2012 will qualify for direct cash payments. The precise payment amount, which is expected to exceed $1,000 per foreclosure, will depend on the number of consumers nationwide who submit valid claims.
Ocwen, the nation’s fourth largest mortgage servicer, specializes in servicing high-risk mortgage loans. The settlement addresses alleged mortgage-servicing and foreclosure abuses by Ocwen, and by two companies later acquired by Ocwen, Homeward Residential, Inc. and Litton Home Servicing, LP. The allegations are the result of a national investigation by state attorneys general, state mortgage regulators, and the Consumer Financial Protection Bureau.
According to a federal-state complaint filed today in the U.S. District Court for the District of Columbia, Ocwen’s conduct resulted in premature and unauthorized foreclosures and violations of homeowners’ rights and protections, including false and deceptive documents and affidavits produced through “robo-signing.” A final consent judgment resolving the complaint allegations is subject to approval by the court.
“The foreclosure process, especially when pursued without court oversight, depends on the integrity of the mortgage servicers responsible for preparing the documentation,” Attorney General Nathan said. “D.C. homeowners should not be at risk of losing their homes as a result of ‘robo-signed’ documents.”
Joseph A. Smith, Jr., the Monitor of the National Mortgage Settlement, will oversee implementation of the Ocwen settlement. The Monitor’s Office of Mortgage Settlement Oversight will attempt to contact the former homeowners who qualify for settlement payments. D.C. homeowners seeking principal reductions from Ocwen should contact the company directly at 1-800-337-6695 or [email protected]. General information about the settlement is available at http://www.CFPB.gov.
The National Mortgage Settlement, a three-year agreement reached in 2012 with the attorneys general of 49 states and the District of Columbia, the federal government, and five mortgage servicers (Ally/GMAC, Bank of America, Citi, JPMorgan Chase and Wells Fargo), has so far provided more than $51 billion in relief to distressed homeowners and has created significant new servicing standards.