A multi-state settlement was reached last month by one of the country’s largest mortgage companies, Ocwen Financial Corporation. The Consumer Financial Protection Bureau, 49 states, and the District of Columbia agreed to the settlement, which totaled $2.1 billion nationally. The lawsuit against the company and two of its subsidiaries alleged that they prematurely and inappropriately foreclosed on homeowners, violated consumer rights, and falsified documents and affidavits. Ocwen Financial Corporation is the fourth largest mortgage servicer in the country. The company agreed to $2 billion in principal reductions and $125 million in cash payments to borrowers on whom it foreclosed. It appears that most of the value in the settlement goes to the reduction aspect.
The settlement comes as a result of a civil lawsuit filed by the Plaintiffs. It does not give Ocwen Financial Corporation immunity from criminal prosecution, nor does it prevent other civil litigants from suing the company. Ocwen Financial Corporation will contact affected borrowers directly in the next three years. Borrowers who will be affected can also contact the company directly to determine whether they stand to benefit from the settlement.
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