Holders of residential mortgage-backed securities are planning to communicate with trustees and master servicers about Ocwen Financial Corp. (OCN)’s practices, according to the Association of Mortgage Investors.
The group “unites RMBS around criticism of #Ocwen servicing abuses,” the Washington-based trade organization said yesterday in a Twitter message. “Look for a forthcoming letter to Trustees, Mastr Servicers.”
New York’s top bank regulator last month asked Ocwen for information about potential conflicts of interest between the firm and affiliated vendors. DoubleLine Capital LP and Kathy Patrick, a partner at Gibbs & Bruns LLP who represents investors including BlackRock Inc. and Pacific Investment Management Co., have criticized a December settlement between the company and government as potentially harmful to mortgage-bond owners by offering credits to the servicer for reworking the loans backing their holdings.
“The Association of Mortgage Investors remains committed to the rights of investors,” Chris Katopis, executive director of the group, said by telephone. “We are currently reviewing action against a number of servicers for their actions that have been harmful for both investors and borrowers.”
He declined to comment further.
Katarina Wenk-Bodenmiller, a spokeswoman for Atlanta-based Ocwen at Sommerfield Communications, declined to immediately comment on the Twitter posting.
Primary servicers handle billing, collections and modifications on outstanding mortgages. One or more of these firms then pass on the cash collected and loan reports to master servicers, which in some cases are the same companies. Master servicers then pass on the cash and reports to bond trustees, which oversee the transacations.
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