What happens to your home loan after it closes and someone has to collect your payments, probably pay your taxes and insurances, and ensure your payment history is reported to a credit bureau?  It, along with as many as millions of other home loans, goes to a loan servicer.

Right now, I’d normally introduce Ocwen by stating what ranking they hold in the loan servicer world. But they have been in so much legal trouble the past few years, they’ve been selling off pieces and reorganizing and etc. I presume, then, that ranking changes as the tides flow – at least I’m fairly certain it has changed from Ocwen being Number One in 2011.

Note: Ocwen is Newco spelled backwards. Frankly, I think their name should be Ocgib (or Bigco backwards) and here’s why.

Our friends at Wikipedia tell us that these all contributed to the size of Ocwen: buying the rights to service $78 billion in mortgages from OneWest Bank, the former IndyMac Bancorp in June 2013; acquiring (in September 2010) the U.S. non-prime mortgage servicing business of Barclays Bank PLC, known as HomEq servicing; completing its acquisition (in September 2011)  of outstanding partnership interests of Litton Loan Servicing LP and certain interest-only servicing securities previously owned by Goldman Sachs & Co. from Goldman Sachs; in April 2012, closing on the purchase of approximately $22 billion of mortgage servicing rights from Saxon Mortgage Services, a unit of Morgan Stanley; buying Aurora Bank's commercial servicing rights portfolio in June 2012; finalizing the acquisition of  Homeward Residential Holdings, Inc. from WL Ross & Co.; partnering in October 2012, with Walter Investment Management Corp. to place the winning $3 billion bid for Residential Capital's mortgage-servicing and origination assets at a bankruptcy auction; entering into an agreement with Genworth Financial Corp. to acquire Genworth Financial Home Equity Access Inc. for $22 million; purchasing ClearPoint in 2012; and, in June 2013, agreeing to buy contracts to handle payment collections on about $78 billion of mortgages from OneWest Bank FSB for $2.53 billion.

Wow, right? That’s a lot of home loans to service. How do they do it? Well, it is a combined effort among the Georgia-headquartered 15,000+ employees – most of whom actually live and work in India, the Philippines, Bangalore, and Mumbai. So how is all of that working out for Ocwen? Let’s see.

Remember the old adage, “the customer is always right”? If you are Ocwen, you apparently kissed it good bye. Proof of that?

-Consumer Affairs gives Ocwen a ONE-star rating and has a website titled “Top 1515 Complaints and Reviews about Ocwen ...” This is just the top 1515 – not all of them.

-Ocwen received an F from the Better Business Bureau. I actually filed a complaint against Ocwen with the BBB. Result? Ocwen never responded. More on that later.

-In 2013, the CFPB ordered Ocwen to “… Provide $2 Billion in Relief to Homeowners for Servicing Wrongs”. My favorite line in this article is, “The consent order addresses Ocwen’s systemic misconduct at every stage of the mortgage servicing process.” Oh my.

-For entertainment purposes, check out some of the comments about Ocwen at Yelp. A few of my favorites include: “This is the worst loan servicing company on the planet.” … “The folks over at OCWEN need to be Flogged-Singapore style!” … “For the love of God -  DON'T allow OCWEN to hold your mortgage!” … “Ocwen is the most horrible company I have dealt with; you are better off having Big Bird from Sesame Street hold your mortgage … “And these are all just on the first page!

-In January of 2015, Forbes reported that California was in the Process of “ Suspending Ocwen Financial's Mortgage License”. Because Ocwen allegedly “did not adequately respond to repeated information requests into its compliance with the state’s Homeowner Bill of Rights.”

-After paying our mortgage on time for several years, our lown was sold to Ocwen. Within a few months, we started receiving letters and nasty phone messages telling us our last company had not paid a tax bill properly and we owed them several hundred dollars. We had documentation galore proving they were in error. We faxed it, emailed it, mailed it, and sent it overnight dozens of times. The result? We got nowhere and had to write them a check for money we definitely did not owe to avoid being coded in default.  Incredible. And that was just the first of many, many “erroneous” requests for we received from Ocwen over the years, including a demand for an escrow shortfall only to receive (the next day) a check for an escrow overage – what?

Whine, whine, whine – why is this allowed to happen and continue? Can no one put a stop to this mistreatment of customers? Why can’t everyone simply refi to a better servicing company? Here are a few thoughts on all of that.

What if this simply is not as bad as it gets? In an October, 2014 USA TODAY article, we learn, “The complaint total ranked Ocwen third for mortgage-related grievances filed with the CFPB during the nearly three-year span. Only Bank of America (BAC), with 29,390 complaints, and Wells Fargo (WFC), with 17,574, had more, the data show.” Time for another, “Oh my!” Surely, someone will do something about all of this? Perhaps ….

Harold Smith once said, “Go ahead and bill these people, hit them in the pocketbook. You will get somewhere.” Perhaps in Ocwen’s case, it is hitting their pocketbook. A March 9, 2016 publication by the New York Times showed this regarding Ocwen’s dropping stock price:

Hmm and ut oh! In early 2015, Bloomberg reported “Ocwen CEO Vows to Shrink Servicer as Complaints Rise”. The new leader believes this will assist in “simplifying” things.

Earlier this year, the pocketbook got hit again when the Wall Street Journal reported “Ocwen to Pay $2 Million in SEC Settlement”. But, alas, this should have no direct positive impact on clients. The article stated, “The SEC said on Wednesday that Ocwen used a “flawed, undisclosed methodology” to value mortgage assets and said the company’s internal controls “failed to prevent conflicts of interest” involving its former chairman.”

But Rob Chrisman reported in his 1/11/16 newsletter, “In the CFPB's consumer complaint database, Ocwen is listed as one of the top companies with the most complaints. The latest report, however, indicates that Ocwen was the only company in the top ten most-complained about companies that saw its complaints drop from the same time period last year (July-September 2014 to July-September 2015). Companies like Equifax had complaints rise 26 percent and Transunion saw a 53 percent increase but complaints against Ocwen dropped 19 percent. The CFPB reported that there has been a 12 percent drop in complaint volume from October 2015 to November 2015 and mortgage complaints fell by 10 percent in this same time period. Debt collections, mortgage, and credit reporting complaints did collectively make up 68 percent of complaints submitted in November 2015.”  

In December of 2014, Reuters reported “Ocwen executive chairman to step down in $150 million settlement”. Further, we read, “Ocwen agreed to install a new independent monitor for up to three years and to appoint two new independent directors to its board.

Executive chairman William Erbey, an Ocwen founder and its chief executive until 2010, will resign on January 16. He will be replaced by Barry Wish, a current director of Ocwen who will become non-executive chairman.

In addition to Erbey's resignation, the company agreed to pay New York state $100 million for housing, foreclosure relief and community development programs. The company also agreed to pay 5,000 Ocwen homeowners who lost their home to foreclosure $10,000 each. Ocwen, which had set aside $100 million for a potential settlement in the third quarter, said it would record a $50 million charge in the fourth quarter to cover the remaining costs.” Well, that’s probably all leading to something good!

And the good news continues. In January of this year, National Mortgage Professional reported, “The City of Milwaukee and Ocwen Financial Corporation have announced an initiative to provide substantial assistance through a five-part plan designed to help Milwaukee homeowners meet housing needs over the next three years (2016-2018).” Excellent!

Next, check out the positive Ocwen customer testimonials on its website. While these may have existed forever, I cannot recall ever seeing them before (and I’ve examined their web site many, many times). Admittedly, the majority if these people’s comments indicate they were in dire straits, but still …

Unfortunately for Ocwen, they still have a long way to go. That is evidenced by the March (or this year!) article in Mortgage Professional American, “Ocwen’s no good, very bad day” – yikes.

With Ocwen servicing approximately $300 Billion, there are bound to be problems, right? I hereby volunteer to personally assist. I will happily and willingly allow Ocwen to forgive the remaining portion of my always-paid-on-time, you’ve-made-enough-money-from-me already home loan! So, yes, they will still be close to that $300 Billion number, but with one less complainer! That counts, doesn’t it?