Concerns Rising Over Mortgage Servicers’ Abilities To Service Loans

Earlier this month, Benjamin M Lawsky, who heads New York’s Department of Financial Services, put the brakes on Ocwen Financial Corp (NYSE:OCN)’s plans to acquire from  Wells Fargo & Co (NYSE:WFC) mortgage servicing rights a package of loans worth $39B. The reason? Unnerved by Ocwen Financial Corp (NYSE:OCN)’s expansion in recent years by buying similar rights from other banks, Lawsky worried that the company may not have the ability to service these loans properly. Mortgage servicing companies take over the administration of loans owned by investors, handing functions such as billing, collections and foreclosures in the case of defaulting borrowers….