Florida Foreclosure Abuse Victims to Receive $18M From Ocwen
Claims forms have been sent to some 26,000 Florida residents whose homes were foreclosed upon when Ocwen Financial Services engaged in what Florida Attorney General Pam Bondi characterized as “mortgage servicing misconduct and foreclosure abuse.”
In total, Floridians are expected to collect approximately $18 million of a $2.1 billion settlement to which the firm agreed in December, following an investigation by the Consumer Financial Protection Bureau. The agreement was finalized in February.
Miami foreclosure lawyers know that Ocwen was one of many financial firms that engaged in shady servicing with the mortgages it managed. In this case, the conduct involved individuals who had their homes foreclosed upon between January 2009 and December 2012. As part of the agreement, the company settled on paying $125 million directly to those homeowners. The remaining $2 billion will be offered up in the form of first lien principle relief to those who managed to hang onto their homes. Floridians are expected to receive approximately $342 million of that amount.
The director of the recently-formed CFPB was quoted as saying Ocwen swindled borrowers at every phase of the lending process. He added the company was deceptive and routinely took shortcuts that benefit its bottom line.
Specifically, that misconduct reportedly involved initiating foreclosures that were both unauthorized and premature. Rights of homeowners were also violated when the firm filed affidavits and documents that were false and deceptive.
The company foreclosed on approximately 184,000 loans during the three-year period in question. Florida borrowers were disproportionately affected, with this state having the second-highest share of those impacted.
Not all borrowers might recognize they have a right to collect, as not all eligible mortgages were filed under the Ocwen name. Some were held under the names Homeward Residential Holdings LLC, which also went by the name American Mortgage Servicing, Inc., and Litton Loan Servicing LP.
Individual payments are going to vary based on the facts of each case. On average, however, Bondi’s office estimated individual borrowers will be entitled to $1,000. The deadline to file for compensation is in September, with the first checks to be received starting in December.
Meanwhile, Florida continues to rank No. 1 in foreclosures, with RealtyTrac’s latest figures indicating the foreclosure rate in this state was higher than anywhere else in the country during the first half of this year.
Statewide, approximately 1 out of every 75 homes was in some stage of the foreclosure process from January through June. Although this represents a decrease of nearly a quarter from where the figures stood last year, the number is still significant.
When the figures were broken down by city, the Miami metro area had the top foreclosure rate. Here, 1 in every 60 homes had some type of foreclosure filing in the first six months of 2014.
Rounding out the top five foreclosure rates in Florida were Orlando, Port St. Lucie, Tampa and the Space Coast.
Many firms that initiate foreclosure proceedings bank on the fact that a large number of homeowners do not fight back. What many don’t realize is the effect of deceptive practices, such as those engaged in by Ocwen, will have have an impact on the ability of banks to prove their cases. That puts borrowers in a stronger position for alternatives to foreclosure, such as home loan modification in the form of principle reduction. Consulting with an experienced foreclosure defense attorney is the best way to determine whether you may be eligible for such relief.
If you’re battling foreclosure in Miami or the surrounding areas contact Jacobs Legal for a confidential appointment to discuss your rights. Call (305) 358-7991. Also, don’t miss Miami Foreclosure Attorney Bruce Jacobs on 880AM/the Biz, every Wednesday from 5 p.m. to 6 p.m. on “Debt Warriors with Bruce Jacobs,” discussing foreclosure topics that matter to YOU.