After suffering net losses in the first and second quarters for 2016 as well as for the full year of 2015, Ocwen Financial Corporation received some positive news.
Standard & Poor’s Ratings Services [1] has announced the following upgrades to Ocwen’s ratings:
- Ocwen Loan Servicing LLC Residential Master Servicer Ranking Raised to Average; Outlook Is Positive
- Four Ocwen Loan Servicing LLC Residential Servicer Rankings Raised to Average; Outlooks Are Stable
- Ocwen Loan Servicing LLC Commercial Servicer Rankings Raised to Average; Outlooks Are Stable
Ocwen views the upgrade as a sign that things have turned the corner after the servicer endured a rocky 2015 which included regulatory scrutiny and action as well as a ratings downgrade. In June 2015, S&P cut Ocwen’s ratings [2] for residential mortgage prime, subprime, special, and subordinate-lien from Average to Below Average. The ratings service said at that time that was cutting Ocwen’s ratings because “regulatory and investor scrutiny and/or actions” had affected Ocwen's operations.
“We are pleased with Standard and Poor’s (S&P) decision,” an Ocwen spokesperson said in a statement. “We believe S&P’s conclusions reflect the significant progress Ocwen has made in enhancing our control functions, and strengthening the company’s governance and financial condition. We are committed to continuing to invest in our operational platform, risk and compliance management systems and service excellence. Ocwen will also continue to work with distressed borrowers to find the right loan modification solution where appropriate, to allow them to keep their homes while continuing to generate more income for loan investors than foreclosure.”
In April 2016, independent monitor Joseph A. Smith Jr. reported [3] that Ocwen had fulfilled its obligation under the 2012 National Mortgage Settlement, having provided more than $2 billion in consumer relief to approximately 23,000 borrowers. Smith also reported that Ocwen did not fail any compliance metrics during the first half of 2015. The monitor reported that Ocwen made progress toward correcting previous fails, but at the same time required Ocwen to hold the foreclosure process for any borrowers who could have been affected by technical issues relating to the delay in implementing the corrective action plan for the metric which tests whether the servicer included certain information in the denial notification to the borrower.