What's New York Homeowners' Takeaway from Today's Mortgage Settlement?

 

There's a big mortgage mess settlement that has been announced today, and New York Attorney General Eric T. Schneiderman says the state will benefit nicely.

The U.S. Consumer Financial Protection Bureau today announced a big $2 billion settlement with West Palm Beach, Fla. mortgage servicing company Ocwen Financial Corp., which focuses on high-risk loans.

Ocwen settled with the CFPB, Schneiderman, and state banking officials and attorneys general in all 50 states over its mortgage servicing and foreclosure practices.

"New York is expected to fare particularly well," notes a New York state AG press release, with nearly $293 million "in first-lien principal reductions going to homeowners across the state."

In the release, Schneiderman calls the settlement "a critical lifeline for New Yorkers who have lost their homes or are suffering through a burdensome process to keep them."

At this writing, Ocwen hasn't issued a public statement. NationalMortgageSettlement.com has posted full details on its home page along with a fact sheet, and a copy of today's complaint against Ocwen by the government parties. The consent judgment can be found HERE.

Ocwen is the third major settlement. The 2012 National Mortgage Settlement will provide as much as $25 billion in similar relief, as well as refunds, to homeowners. Last month’s $13 billion JP Morgan agreement also provided homeowner relief related to questionable practices involved with the sales of mortgage-backed securities. (The QuidnuncRE analysis of JP Morgan's practices in its joint statement of facts with the U.S. Justice Department can be found HERE.)

The complaint against Ocwen, filed today in the U.S. District Court for the District of Columbia, alleged misconduct that resulted in premature and unauthorized foreclosures, violations of homeowners’ rights and protections, and the use of false and deceptive documents and affidavits, including robosigning.

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