Servicing

The non-jury trial in the U.S. District Court of the Southern District of New York in Manhattan is scheduled to begin on Monday, March 16. If no last-minute settlement is reached, Nomura and RBS would be the first two financial institutions to go to trial out of the 18 lenders FHFA sued in 2011 to recoup U.S. taxpayer costs following the government's $188 billion bailout of Fannie Mae and Freddie Mac in 2008, after which the government seized control of both Enterprises. The other 16 lenders have paid a combined total of about $24 billion to settle with FHFA, including $9.3 billion paid by Bank of America in March 2014.

U.S. District Judge Katherine Forrest approved the settlement, which resolves allegations from investors that the banks failed in their role as trustees for mortgage-backed securities trusts containing sloppy loans that were issued by Washington Mutual Inc. before the 2008 financial crisis.

These two transactions together represent approximately $55 billion in unpaid principal balance for which Ocwen has agreed in the last week to sell the mortgage servicing rights. Both of the transactions are expected to be completed in the next six months. According to Ocwen's announcement, the Atlanta-based servicer expects the two transactions will generate approximately $550 million in proceeds and "accelerate Ocwen's strategy to reduce the size of its Agency servicing portfolio."

Houses lose out on big money when they fail to take advantage of low interests and refinance. For example, a household with a 30-year, fixed-rate mortgage of $200,000 at an interest rate of 6.5 percent that refinances when rates fall to 4.5 percent will save over $80,000 in interest payments over the life of the loan, even after including all the typical refinancing costs. Mortgage rates were around 4.7 percent in December 2010, higher than the current rate of 3.5 percent. Still, many homes fail to refinance.

Federal regulators have released the last video in a series created to help bank employees meet regulatory requirements set by the Consumer Financial Protection Bureau (CFPB).

Quality features of the bulk servicing portfolio include 100 percent fixed-rate and first lien product, a weighted average original FICO score of 755, a weighted average original LTV ratio of 80 percent, and a weighted average interest rate of 3.9 percent.

Glancy Binkow & Goldberg LLP alerted HLSS shareholders on Tuesday about the suit, which targets HLSS for not being open about the company's close relationship with Ocwen, which has suffered from wave after wave of regulatory setbacks in the last year.

The newest offering is a Fannie Mae, Freddie Mac, and Ginnie Mae MSR portfolio with $736 million of unpaid principal balance, according to an announcement from MountainView Servicing Group, which is acting as adviser on the sale.

Morningstar's announcement came just one day after Ocwen CEO Ron Faris told his company's stakeholders that he expected Ocwen's earnings in Q4 to take a hit based on mounting regulatory pressures, expenses, and a ratings downgrade by Fitch Ratings in the week.

In a note to stakeholders released Thursday, Faris reviewed a handful of the regulatory hurdles Ocwen has had to deal with in the past year, including a long-running investigation from New York's top financial regulator that eventually resulted in a $150 million settlement.