TALLAHASSEE — Ocwen Mortgage Servicing settled a lawsuit by Attorney General Ashley Moody earlier this month involving alleged over-charging and mishandling escrow accounts, without admitting liability.
The company agreed to settle the 2017 lawsuit, citing it was in the best interest of stakeholders.
"Ocwen believes that it has sound legal and factual defenses to all of the State of Florida’s claims but concluded that it is in the best interest of its stakeholders to resolve this matter without admitting liability in order to avoid the further distraction and expense of litigation," the company said in a statement provided to the Florida Record. "With the resolution of this lawsuit, the company has resolved the last state matter arising from the legacy actions taken in April 2017."
Moody's 2017 lawsuit alleged that Ocwen made several errors when it was servicing residential mortgage loans, such as not accurately onboarding loans into its system of record and mishandling some of the borrowers' escrow accounts. It also alleged overcharging on accounts and sending misleading communications regarding accounts to borrowers, according to the news release.
Ocwen believes its servicing practices have and will continue to result in substantial benefits to consumers, the statement continued.
"Since the financial crisis, we have helped more than 1.5 million U.S. homeowners in need of assistance avoid foreclosure, forgiven approximately $19 billion in mortgage debt, and, most recently, provided forbearance relief to more than 170,000 homeowners who were impacted by the COVID-19 pandemic," the company's statement said. "We look forward to continuing to work proactively and productively with our home-state regulators to create positive outcomes for the customers we serve."
The settlement will provide $5.16 million to the state, along with an additional $1 million to be payable in two years for event-specific obligations. The company also agreed to waive certain late fees, as well as creating a loan modification program for certain borrowers in the state.
“This resolution is a continuation of our efforts to correct harmful deficiencies in mortgage servicing practices and ensure that distressed homeowners who have been impacted by servicing errors receive much-needed relief—relief that is especially important in these challenging times," Moody said in a news release.
The consent judgment will resolve the litigation.