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Regulators list many mortgage errors at Ocwen Financial

Posted 4:42 p.m. Thursday

Federal and state regulators say Ocwen Financial — one of the nation's largest mortgage lenders that is not a bank — made numerous errors in the mortgages it serviced.

Ocwen disputes the allegations by the Consumer Financial Protection Board and calls them "politically motivated."

Regulators cited items including that the company:

— Relied on error-prone software to process and apply mortgage payments and maintain loan balance information, and instead of fixing the software used manual workarounds that generated more errors.

— Illegally foreclosed on at least 1,000 people. In those cases, they said, Ocwen sometimes foreclosed before reviewing borrowers' applications for loss mitigation. In some cases, Ocwen requested more information from borrowers, but foreclosed before the deadline.

— Failed to properly credit numerous borrowers' loan payments and failed to send accurate statements.

— Mismanaged escrow accounts for more than 75 percent of the 1.4 million loans it services. They said Ocwen failed to properly analyze some accounts because of its reliance on manually entering information.

— Failed to make timely home insurance payments that led to lapses in coverage for more than 10,000 borrowers.

— Neglected to properly investigate and respond to complaints about errors. Since April 2015, Ocwen received more than 580,000 complaints from over 300,000 different borrowers.

— Overcharged consumers roughly $1.2 million because Ocwen failed to cancel borrowers' private mortgage insurance in a timely manner once the balance on their mortgages reached 78 percent of the property's original value.

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