Atlanta-based Ocwen, the country's No. 4 mortgage servicer in terms of size, has reached a new settlement with Massachusetts. The deal stipulates $3 million in payouts to homeowners as well as a $700,000 fine to be paid to the state.
"This agreement provides for direct relief for affected borrowers and requires that Ocwen undertake efforts to repair problem titles in the Commonwealth," declared Massachusetts Attorney General Martha Coakley. She said Ocwen unlawfully foreclosed some properties and neglected to properly notify borrowers who were in default, as mandated by state law. The firm's Litton Home Servicing unit, meanwhile, began foreclosures on some homes to which it did not even hold title, Coakley added.
The $3 million deal comes six months after Ocwen agreed to give Massachusetts homeowners an estimated $80 million in cash and principal reductions on their mortgages under a $2.1 billion national settlement involving loan servicing problems and illegal foreclosures.