Servicer and State of Maryland Fight Foreclosures

Subprime servicer Ocwen Financial Corp. and Gov. Martin O'Malley of Maryland have signed a compact designed to reduce foreclosures through a technology-assisted program of modifying loans that are delinquent or at risk of becoming delinquent. Ocwen services approximately 341,000 mortgages, including 7,072 in Maryland, 85% of which are subprime. "It's productive to work hand-in-hand with a state government to formalize a commitment and approach to foreclosure prevention and loan modifications," said Ronald Faris, president of Ocwen. In their compact, the state and Ocwen have agreed to designate Ocwen home retention consultants as "Team Maryland" to service homeowners who are working with the state's Foreclosure Prevention Assistant Network. They will accept a letter of commitment for homeowner assistance from Maryland's Department of Housing and Community Development's Bridge to Home Loan program as an initial payment in a loan modification. "Ocwen has provided our counselors clear instructions for the submission of loss mitigation packages," said Anne Balcer Norton, director of Foreclosure Prevention at the St. Ambrose Housing Aid Center Inc. in Baltimore. So far this year, Ocwen has achieved loan workouts for approximately 55,000 homes across the country. With the help of its technology, the company manages a large and challenging subprime portfolio, which has an aggregate unpaid balance of $42 billion.