RMBS holders should prepare for Ocwen ‘worst case’

Ocwen
By Will Caiger-Smith
22 Oct 2014

Allegations made by New York financial watchdog Benjamin Lawsky that loan servicer Ocwen Financial backdated thousands of letters to borrowers, preventing them from appealing denials of loan modifications, could lead to increased servicing disruption and significant costs for residential mortgage-backed security (RMBS) investors, said analysts on Wednesday.

Lawsky, superintendent of New York’s Department of Financial Services, this week publicly released a letter accusing Ocwen of “likely causing significant harm” by backdating letters denying borrowers loan modifications. In many cases, the letters were dated more than 30 days prior to the date they were mailed, eliminating ...

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