Arkansas reaches settlement with mortgage servicer - KATV - Breaking News, Weather and Razorback Sports

Arkansas reaches settlement with mortgage servicer

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LITTLE ROCK (AP) - The state of Arkansas has reached a settlement with Ocwen Financial Corp. over allegations of misconduct involving Ocwen's mortgage-servicing practices.

The settlement announced Thursday by Attorney General Dustin McDaniel involved Arkansas and 48 other states as well as the federal government.

Ocwen has agreed to provide $2 billion in first-lien principal reduction to homeowners and $125 million in cash payments to borrowers on nearly 185,000 foreclosed loans. The settlement terms address misconduct by Ocwen and two companies that have been acquired by Ocwen: Homeward Residential Inc. and Litton Home Servicing LP.

In Arkansas, homeowners with loans serviced by Ocwen are expected to receive about $5.56 million in principal reductions.

Last year, Arkansas was part of a multibillion dollar settlement with five of the nation's largest banks over fraud and abuse.

Copyright 2013 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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