Ocwen, Wells Fargo multi-billion dollar deal is a no go

by MPA14 Nov 2014
Ocwen Financial’s long-pending mortgage-servicing rights -- worth roughly $39 billion --- with Wells Fargo is not happening, according to a filing with the Securities and Exchange Commission (SEC) from Ocwen.

The transaction has been in jeopardy since February when Benjamin Lawsky, superintendent of New York's Department of Financial Services, put an “indefinite hold” on it.

The filing stated the companies signed a termination agreement, and Ocwen will receive its entire $25 million deposit back. The decision to end the deal was mutual between the two because of the intense regulatory pressure, according to The New York Post.

If the transaction had completed, Ocwen would have had the rights to service more than 184,000 home loans from Wells Fargo, according to the SEC filing.

Ocwen is currently being accused of denying struggling borrowers the chance to fix loan problems and avoid foreclosures. A recent investigation by the New York's Department of Financial Services found that Atlanta-based Ocwen Financial inappropriately backdated thousands of time-sensitive letters to mortgage borrowers and did not take action to fix the issue despite repeated notices of concern.

 

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