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Ocwen Financial has delayed filing its 2014 results and announced the sale of more servicing rights.
March 18 -
Embattled mortgage servicer Ocwen Financial faces up to $26 billion in damage claims by bondholders and a greater risk of being fired as a mortgage servicer on thousands of small, private-label trusts.
February 27 -
It's not quite too big to fail, but Ocwen is the country's largest servicer of subprime mortgages. So if it were forced to sell itself, or even failed, the transfer of some $410 billion in servicing rights could create havoc in the mortgage market, industry experts said.
February 23
Ocwen Financial is fighting back against a group of large bondholders that have accused the Atlanta mortgage servicer of improper servicing practices and an alleged breach of trust.
On Sunday, Ocwen sent a letter to 119 investors rejecting allegations that its servicing practices had triggered an "ongoing event of default."
Ocwen's letter was a response to allegations in January by the Houston law firm Gibbs & Bruns accusing Ocwen of major servicing violations. Gibbs & Bruns, which represents investors in private-label trusts such as BlackRock and Pimco, accused Ocwen of conflicts of interest, imprudent modification practices and a failure to account for principal and interest payments to the trusts.
Ocwen is claiming that the bondholders' ultimate aim is to limit the number of loan modifications it performs and instead foreclose on more borrowers. Foreclosures, Ocwen claims, would increase the returns to senior bondholders.
"Nothing alleged by the investors establishes that Ocwen breached the standard of servicing called for by the agreements," Timothy Hayes, Ocwen's executive vice president and general counsel, wrote in a 30-page response.
Ocwen said the allegations are part of an effort to "impose changes to standard servicing practices, with the goal of forcing more home foreclosures and fewer loan modifications."
The company said each modification it performs "is designed to yield a higher anticipated recovery to investors than foreclosure."