The company will have to pay a $1 million for not properly refunding force-placed insurance premiums to some borrowers during the first quarter of the year, according to a HousingWire report.
Under the terms of the National Mortgage Settlement, Ocwen is required to terminate force-placed insurance policies and give borrowers prorated premium refunds within 15 days of receiving evidence that a borrower has obtained his or her own mortgage insurance policy. The settlement allows servicers an error threshold of 5% on the metric – but according to a court filing by the settlement’s monitoring committee, Ocwen exceeded that threshold in the first quarter.
Because Ocwen had also failed the same metric in 2015, the recent failure triggered a $1 million fine, according to HousingWire.
In a response to the fine, Ocwen said that it took issue with the monitoring committee’s population-eligibility criteria, which helped determine the 5% error threshold. Company spokesman John Lovallo said that Ocwen had agreed to pay the fine “without agreeing” to the committee’s allegations.
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Ocwen Financial is in hot water for violating the terms of the National Mortgage Settlement – and it’s going to cost the servicer $1 million to turn down the heat.