News Release — Vermont Attorney General’s Office
Dec. 19, 2013
Some Vermonters will benefit from settlement of a $2.1 billion national multistate-federal settlement with the fourth-largest mortgage servicer in the United States, Ocwen Financial Corporation of Atlanta, Georgia, and its subsidiary, Ocwen Loan Servicing.
Vermont Attorney General William H. Sorrell announced today Vermont is joining the settlement that stems from misconduct in servicing high-risk mortgage loans on the part of Ocwen and two related companies, Homeward Residential Inc. and Litton Home Servicing.
Under the settlement, over $2 million in first-lien principal reductions will be made available to Vermont consumers; some Vermonters with foreclosed loans may also be eligible for cash payments, the amount of which will depend on the number of consumer claims filed.
According to a complaint filed in federal court in the District of Columbia, Ocwen’s misconduct led to premature and unauthorized foreclosures, violations of homeowners’ rights, and the use of false and deceptive documents and affidavits, including “robo-signing.”
“The servicing misconduct in this case was similar to the issues raised in the 2012 national mortgage settlement with five major banks,” Attorney General Sorrell said, and this resolution reflects our commitment to holding servicers accountable for their actions.”
Grace Pazdan, a Staff Attorney at Vermont Legal Aid, observed that in her experience representing homeowners, Ocwen has had “one of the worst track records as far as servicing abuses,” and she expressed the hope that the settlement “will instigate reforms at Ocwen that will bring much needed relief to Vermont families who are working to save their homes.”
The national settlement includes $2 billion in first-lien principal reduction, and $125 million in cash payments to borrowers on nearly 185,000 foreclosed loans. The settlement does not grant immunity from criminal prosecution, nor prevent homeowners or investors from pursuing individual, institutional or class action civil lawsuits.
In some cases, Ocwen will notify borrowers directly regarding principal reductions.
However, borrowers should contact Ocwen to obtain more information about principal reductions and whether they qualify under terms of this settlement; for that purpose, Ocwen’s toll-free number is 1-800-337-6695, and its email address is ConsumerRelief@Ocwen.com.
A settlement administrator will notify qualified foreclosed borrowers regarding the cash payments.
For more information on the settlement, link here to the FAQs available on the Attorney General’s website.