Firm agrees to $2B deal for loan abuses
WASHINGTON (AP) — Ocwen Financial Corp. will reduce struggling borrowers’ loan balances by $2 billion in an agreement with federal regulators and 49 states over foreclosure abuses.
The Consumer Financial Protection Bureau and state attorneys general announced the deal Thursday with the Atlanta-based company, one of the largest U.S. mortgage servicers. The regulators said Ocwen pushed borrowers into foreclosure through illegal actions, such as failing to promptly and accurately credit mortgage payments.
Ocwen will refund a combined $125 million to about 185,000 borrowers who’ve been foreclosed upon. It also agreed to change the way it manages mortgages.
In South Dakota, Ocwen will provide borrowers an estimated $540,000 in first lien principal reductions, and 127 loans will be eligible for a cash payment.