California is reportedly seeking to suspend mortgage servicer Ocwen Financial Corp.'s license to operate in the state, saying the company failed to submit paperwork showing that it complies with state laws.
As per a Los Angeles Times report, the state Department of Business Oversight (DBO), which licenses non-bank mortgage lenders and servicers, had requested the paperwork from Ocwen early last year, but the company failed to comply.
In a Tuesday release, Ocwen officials say they are fully cooperating with the California DBO and have already provided the requested information.
‘Since this notification, we have dedicated substantial resources toward satisfying the DBO's requests,’ says Ron Faris, president and CEO of Ocwen. ‘We believe we have provided the requested information in the format requested. We expect that we will receive follow-up requests or clarifications and that further document and information exchanges may take place. We expect our ongoing cooperation will result in a satisfactory outcome for all parties.’
‘Ocwen has a strong track record in California in helping struggling homeowners, and we are committed to working cooperatively with the DBO to further our common goal of assisting struggling families,’ adds Faris. ‘In 2014, Ocwen completed more than 13,000 loan modifications and over 3,500 short sales in California. Over 35 percent of these loan modifications included some form of principal reduction relief for homeowners, totaling more than $460 million.’
Supporting Ocwen is Todd Emerson, CEO of Springboard, a nonprofit, U.S. Department of Housing and Urban Development-approved housing counseling agency. In the release, he says the national mortgage servicer ‘has been a strong partner in helping California families save their homes from foreclosure.’
‘Ocwen's Shared Appreciation Modification and principal reduction products have and continue to provide sustainable resolutions for struggling families in California,’ Emerson says.
Should Ocwen lose its license in California, the loans it services in that state would have to be transferred to another mortgage servicer. According to the Los Angeles Times report, about 15% of Ocwen's total loans are in the state. Those loans represent about 23% of its total unpaid principal balance, the newspaper says in its report.
Ocwen, which has faced an avalanche of regulatory scrutiny during the past two years, saw its shares plummet on Tuesday in reaction to the news.