Arkansas Reaches Settlement With Mortgage Servicer Over Misconduct
The state of Arkansas has reached a settlement with Ocwen Financial Corp. over allegations of misconduct involving Ocwen's mortgage-servicing practices.
The settlement announced Thursday by Attorney General Dustin McDaniel involved Arkansas and 48 other states as well as the federal government.
Ocwen has agreed to provide $2 billion in first-lien principal reduction to homeowners and $125 million in cash payments to borrowers on nearly 185,000 foreclosed loans.
The settlement terms address misconduct by Ocwen and two companies that have been acquired by Ocwen: Homeward Residential Inc. and Litton Home Servicing LP.
In Arkansas, homeowners with loans serviced by Ocwen are expected to receive about $5.56 million in principal reductions.
Last year, Arkansas was part of a multibillion dollar settlement with five of the nation's largest banks over fraud and abuse.