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Ocwen has been hit with a proposed class action lawsuit alleging the mortgage servicing company illegally charges “prepayment penalties in the form of “post-payment” interest on loans insured by the Federal Housing Administration.”
Plaintiffs Leo and Jessica Ramirez say that as a result of Ocwen’s actions, the company has “collected hundreds of millions of dollars in post-payment interest unlawfully” the lawsuit says, and the pair is seeking to recover damages on behalf of themselves and a nationwide class.
Post-payment interest refers to the “interest that a lender collects after the borrower has paid the full unpaid principal of the loan.”
“For example, if a borrower pays off the loan in full on August 5, and the lender continues collecting interest for the remainder of August, the lender has collected post-payment interest from the borrower. Any interest collected after the borrower makes payment of the full unpaid principal is post-payment interest,” the Ocwen class action says.
According to the complaint, on August 2010 the Ramirez’s secured a FHA-insured loan from Fairway Independent Mtg. Corp. to purchase a home. Ocwen later acquired the loan. Since the loan was insured by the FHA, “Ocwen is required to comply with FHS regulations with respect to [their] loan,” the class action lawsuit states.
In 2013, the couple refinanced the loan and requested that Ocwen provides them with a payoff statement so they could pay off the loan. Ocwen provided a payoff statement dated March 29, 2013, which reportedly represented that the Ramirez’s owed $911.57 in interest. Essentially, Ocwen charged and sought to collect interest for the entire month of April, even though the payoff occurred before May 1, 2013.
On April 4, 2013, the Ramirez’s paid Ocwen $258,540.11, which included $911.57 in interest.
However, because Ocwen required the couple to pay interest for the entire month of March and April – even though the Ramirez’s paid the full unpaid principal on April 4, 2013, Ocwen collected post-payment interest.
Additionally, the class action lawsuit claims Ocwen did not provide the Ramirez’s with an FHA-approved payoff form. Specifically, the form used by Ocwen was both misleading and contains language that does not comply with the mandatory language of the FHA approved form, according to the complaint. As such, any post-payment interest collected by Ocwen violates the uniform provisions of the note and FHA regulations, the lawsuit contends.
“All of the relevant government agencies now agree that collecting postpayment interest is an unfair prepayment penalty and is against public policy,” the Ocwen class action lawsuit states.
The plaintiffs are seeking to represent a class of past Owcen borrowers comprised of “any person who has a loan (i) insured by the FHA at any time during the period beginning August 2, 1985 and ending on January 20, 2015, (ii) that held by Ocwen as of the day payment of the full unpaid principal was made, and (iii) for which Ocwen collected interest for any period after payment of the full unpaid principal was made.”
Along with claims against Ocwen for breach of contract, proposed class action lawsuit request declaratory and injunctive relief as well as compensatory and statutory damages.
The plaintiffs are represented by Archie I. Grubb II, W. Daniel “Dee” Miles III, Andrew E. Brashier, and Rachel E. Boyd of Beasley Allen Crow Methvin Portis & Miles PC; and Michael L. Werner and Matthew Q. Wetherington of the The Werner Law Firm.
The Ocwen Interest Charges Class Action Lawsuit is Ramirez, et al. v. Ocwen Loan Servicing LLC, Case No. 1:17-mi-99999-UNA in the U.S. District Court for the Northern District of Georgia, Atlanta Division.
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15 thoughts onOcwen Class Action Alleges Illegal Post-Payment Interest Charges
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Please add me. They service my loan and added all kinds of fees then sold the loan to another company.
Is there a class action law suit on them, they tried to sell my house out from under me. If not here should be.
My family almost lost our home due to OCWEN to NOT applying payments to my loan after we had an agreement. After sending documents to them several times had they acted like they never received documentation for the agreement. They tacked on thousands of dollars in fees and interest by the time it came to pay off my loan. This company and its mortgage practices should be put out of business. They take advantage of people in hard situations.
I too have been duped by this firm and will sue.
Things are very difficult at this time as I am disabled and a widow, and this is nothing less than a predatory loan.
FeildStone Mortgage sold my mortgage to Ocwen and they mis-posted my mortgage payments which let to showing default when my mortgage was not behind. The late fees built up. keep me informed on this lawsuit.
OCWEN has been my nightmare. Why call nothing that I’m told is the same from phone call to phone call. They don’t do what they say, you can’t make any sense of ALL the fees you are being charged. They say I have delinquent but I get different dates, and 2/3/4/5 times. If they say l delinquent then they should have all information?Why does one person say no to repayment agreement and the other says yes?Here is the kicker for me Why can I only call India, who exactly has my loan docs, why is everyone of us going through similar situations. Why is this legal, the fate of our homes are in other people’s hands and county. Again why is this legal I can’t speak to someone other than calling India? Sounds like a a real game to me. My accountant, and my attorney can’t even make sense of my history report. No right information no calls back different answers everytime you call, payment put other places than where it should go. OCWEN delays you so the fees go up, your so confused then they get to foreclose on your home. If someone comes to my house for a inspection MONTHLY I’m paying for then I want proof. If I’m delinquent or not I want proof! I never saw any of this go on with my other company. We are being abused, and it feels like there are huge amounts of violations going on. Why is Ocwen still in business? They are being sued for service violations, ceased and desist orders, but still being criminals. I just received a statement and it is very misleading to what my next payment will be. Why so l fail with my payment agreement.
I can sense the frustration in what-and how- you have written down your experience. I too have experienced the bad and illegal servicing practices of this company that should be put OUT of business by our government. OCWEN does not help homeowners-all they do is practice subterfuge and slight-of-hand theft. These OCWEN clowns actually attempted to place a “forced place flood insurance policy” on my loan when I have an escrow account that they use to pay my insurances because I am not allowed or trusted to pay my insurance myself. Down right thievery. OCWEN is a joke and our government officials are even more of a joke for not seeing that these thieves are jailed and fined and put out of business.
THIS COMPANY STOLE THOUSANDS OF DOLLARS FROM ME. THEY REPEATLY DID NOT APPLY PAYMENTS TO MY ACCOUNT. I FINALLY GOT AWAY FROM THEM AND MY PAYOFF AMOUNT WAS AS IF I NEVER MADE A PAYMENT. I DIDN’T GET ANY HELP, STAY AWAY FROM THIS COMPANY.
Sadly, we as mortgagees have no choice in who ultimately services are loans. :( I strongly dislike these thieves too. OCWEN sucks at servicing.
So can other people who have had the unfortunate luck to have their mortgage sold to Ocwen join this lawsuit?
I had problems when my mortgage was sold from One West Indy Mac to Ocwen and they mis-posted payments and late fees and stated I was behind. Please notify me about this suit. Bugginkrd@yahoo.com or 773-933-6899.