Dynamic Accident Lawyers: Ocwen Financial Apologizes Over Backdated Loan Modification Letters

Ocwen Financial, a provider of residential and commercial mortgage loan servicing, has recently come under fire for allegedly backdating thousands of time-sensitive letters to mortgage clients.

According to the New York Department of Financial Services, the backdated letter scandal that has beset mortgage servicing giant Ocwen has prompted an expanded investigation into the company’s loan modification practices.

In response, Ocwen has issued a public apology letter to all homeowners who received the misdated letters. The company said that letters were generally dated when a decision was made to create the letter, not when the letter was actually created.

Ocwen CEO Ron Faris wrote to clients explaining what happened and what steps the company is taking to investigate the issue, identify any problems, and rectify the situation.

“Historically letters were dated when the decision was made to create the letter versus when the letter was actually created. In most instances, the gap between these dates was three days or less,” Faris writes. “In certain instances, however, there was a significant gap between the date on the face of the letter and the date it was actually generated.”

The Ocwen letters had been sent to borrowers who were behind on payments or in need of loan modifications, Benjamin Lawsky, superintendent of New York’s Department of Financial Services said.

Many went to borrowers who had been denied loan modifications, informing them they had 30 days to appeal the decision, but the deadline had passed by the time the backdated letters arrived, making it impossible for homeowners to modify their mortgages and increasing the likelihood of default, Lawsky said.

What is A Loan Modification?

A loan modification is a process whereby eligible homeowners negotiate changes in the terms of their mortgage agreements with their lenders that offer them more favorable payment conditions, such as a lower interest rate, reduction of the principal, forgiveness of late fees or arrearages, or a longer time to pay.

In some cases, however, a lender, individual, or business that misuses the loan modification process can face a loan modification lawsuit. Distressed homeowners who feel they have been scammed, or that their loan modification application has been inexplicably turned down despite having met all the requirements, may wish to sue lenders or individuals who may have defrauded them.

There are a number of allegations that can be brought against a lender, business, or legal or financial professional in a loan modification lawsuit. These include:

The bank claims it lost your documentation.
An extension granted by a lender during a trial modification is suddenly withdrawn, despite payments having been timely made, and results in foreclosure.
The original loan was predatory.
A leaseback scheme initiated by a business or individual causes loss of your home.
A fake modification program was initiated by a lawyer or alleged financial consultant.
There was a breach of contract.

Loan Modification Lawsuits

Mortgage servicers who violate government loan modification program rules can be held liable for damages incurred by homeowners. If you have been denied a permanent loan modification due to the illegal actions of mortgage servicers or banks you may be able to file a loan modification lawsuit.

Join a Free Home Loan Modification Class Action Lawsuit Investigation

If you applied for a home loan modification to avoid foreclosure and were denied because your bank didn’t follow the current mortgage modification guidelines, you may be eligible to participate in a class action lawsuit to resolve this problem:

Bank of America
Nationstar Mortgage
Ocwen Loan Servicing
Seneca Mortgage Servicing
Green Tree Servicing
PHH Mortgage
Select Portfolio Servicing
PNC
Citigroup
US Bank
Walter Investment Management Corp.
Cenlar
JP Morgan Chase
Wells Fargo
Flagstar Bank
GMAC
One West
Caliber Home Loans

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