Ocwen under fire again for servicing abuses

by Ryan Smith21 May 2014
Ocwen Financial Services just can’t stay out of trouble. The mortgage servicer is currently being investigated by New York State over alleged servicing abuses, and now it’s the subject of a class action lawsuit.

Ocwen is being sued by a group of homeowners alleging that the company engages in substandard and illegal se4rvicing practices, according to a HousingWire report. The homeowners suing Ocwen say that they paid their mortgages in full, but Ocwen took much longer than the legally required amount of time to file loan satisfaction documents.

Lead plaintiff Jill Dempsey, for instance, said she paid off a home equity line of credit on her Pennsylvania home. State law requires the servicer to file satisfaction documents within 60 days of receipt of payment. However, Ocwen did not file the documents until about 253 days after receiving Dempsey’s payment – which is 252 days after she submitted her first written request for them to do so, according to HousingWire.

The lawsuit alleges that “Ocwen’s failure to timely record a satisfaction piece in this case is typical for Ocwen, which has a nationwide pattern and practice of recording satisfaction documents beyond the statutorily prescribed time limits to do so.”

The lawsuit is hardly the first of Ocwen’s troubles. The company has been plagued with allegations that it mishandled borrowers’ loans. In December, Ocwen reached a settlement with the Consumer Financial Protection Bureau in which it agreed to provide $2 billion in consumer relief after a CFPB probe found that the company “took advantage of borrowers at every stage of the process.