FORECLOSURE HELL


I had been doing so much better about keeping up with my blogs, until about this last week. I had not gotten back to posting as much as I had in the past, but was doing much better.

I have to admit though, every month, beginning the week before foreclosure hell (the day they auction the homes foreclosed upon), have been particularly hellish.

I guess for a while, no one I know was being foreclosed upon. But beginning last month, my friends began being sold at auction again. It had been a whole year until just these last couple of months. Then all of the sudden, properties that the banks had lost interest in, out of the blue, and with little or no warning, were sold at auction.

We all managed to stop two of the sales, those two were cancelled, but last month, one was lost to foreclosure, and it took a lot of work to get cancelled, the two that were cancelled.

So, even though there may not be the number of foreclosures every month that there had been for a long time, looks like the banks have managed to get lined up, these companies, that will purchase damn near any house at auction. These companies that want to turn around and rent you your house they just purchased at foreclosure.

I told everyone, back in 2008-2009 when Goldman Sachs’ sorry ass said that “only the rich should own houses, everyone else should be renters”, that this is what could be expected. Yes, it took another 8 years for it to happen to this scale, but it is here, and it won’t be going away, till they get every one of our homes.

I have watched foreclosure sales every month since around 2006, and all the properties that were fought for, and the banks, just kind of fizzled away without a lot of fuss, homes that they realized would be close to impossible to get the foreclosed upon owner to leave, now that they can work it out to where these rent home companies, are the ones that has to get rid of the previous owners of the properties.

The banks see this as minor housekeeping, which they don’t mind at all.

Housing Wire’s Ben Lane’s Article: Ocwen Posts Big Loss, Erasing Profits for 2015


Home » Ocwen posts big loss, erasing profits for 2015

Ben LaneOctober 28, 2015 5:08PM

http://www.housingwire.com/articles/35480-ocwen-posts-big-loss-erasing-profits-for-2015
As the company itself predicted just last month, Ocwen Financial (OCN) is now in a position to record a loss in 2015, after the nonbank reported Wednesday that it generated a net loss of $66.8 million in the third quarter or $0.53 per share.

The company generated revenue of $405 million, down 21% compared to the third quarter of 2014.

According to a note from Briefing.com, Ocwen’s third quarter results were worse than the Capital IQ Consensus, which had Ocwen posting a loss of $0.22 per share.

For the full year 2014, Ocwen recorded a net loss of $546 million, a stark reversal from 2013, when Ocwen reported net income of $310.4 million.

The company told its shareholders in September that it expected to post a loss in 2015 as well, citing lower revenue expectations coupled with higher expected operating, interest and tax expenses.

Ocwen actually posted profits – albeit small ones – in the first and second quarters of this year. In the first quarter, Ocwen reported net income of $34.4 million, while in the second quarter, Ocwen reported net income of $10 million, but those profits have been undone by Ocwen’s rough third quarter.

According to the company, its cash flows from operating activities were $239 million for the third quarter, compared to $349 million during the same period last year.

The company said that its pre-tax loss for the third quarter of 2015 was $55.9 million.

According to the company’s earnings statement, its pre-tax results were impacted by a “number of significant items” including:

$41.2 million of net gains from sales of performing and non-performing agency mortgage servicing rights relating to loans with a total unpaid principal balance of $22.0 billion
A loss of $23.4 million of interest rate driven impairment of the company’s Ginnie Mae MSRs carried at lower of cost or fair value
A loss of $17.4 million in restructuring costs, which included severance payments to 300 of the company’s residential servicing employees at Ocwen’s facility in Waterloo, Iowa, which represented 10% of the company’s approximately 2,900 U.S.-based employees; and Fiserv platform exit costs, which the company stated was going to cost $10 million
A loss of $12.5 million of monitor costs
A loss of $11.1 million in legacy servicing claim reserves
A loss of $11.0 million in legal and other settlement costs
A loss of $8.2 million of expense incurred pursuant to the company’s agreement with New Residential Investment Corp. in connection with downgrades to the company’s Standard & Poor’s servicer ratings
Additionally, the company’s servicing segment recorded a $12.7 million pre-tax loss inclusive of the gain on sales of MSRs, MSR fair value changes and legacy servicing claim reserves.

“In the third quarter, we continued to make progress on our strategic and operating initiatives,” Ron Faris, president and CEO of Ocwen, said.

“Our asset sale strategy has succeeded in generating proceeds and gains for the company, enabling us to reduce leverage and focus on simplifying our operations,” Faris said.

“Our operating cash flow remained strong, enabling us to end the quarter with more than $731 million in available liquidity, including $459 million of cash on hand,” Faris continued. “The capital markets also continue to demonstrate strong support for the company, as we were able to successfully refinance our $1.8 billion OMART servicing advance facility and execute an amendment with our term loan lenders to give us more flexibility moving forward.”

At the end of July, Faris told investors that the second half of 2015 will be “challenging” from an income perspective for Ocwen.

Ocwen has been undergoing a shift in its business model over the last 18 months, ever since its $150 million settlement with the New York Department of Financial Services over its servicing practices.

In December of last year, Faris announced that Ocwen was moving away from agency servicing, which the company has done throughout this year.

In fact, Ocwen’s servicing portfolio has fallen significantly in 2015.

As of Sept. 30, 2014, Ocwen’s servicing portfolio was $411.28 billion in unpaid principal balance.

As of Sept. 30, 2015, Ocwen’s servicing portfolio had fallen to $288.07 billion, a decrease of more than $123 billion.

Ocwen noted that it originated forward and reverse mortgage loans with unpaid principal balances of $1.1 billion and $198.5 million, respectively, in the third quarter.

“We are making solid progress in developing our lending capabilities including expansion of our product offering,” Faris said. “Additionally, we are progressing as expected on the cost improvement initiatives that we laid out in the third quarter and anticipate identifying additional opportunities to reduce our operating costs. We remain committed to investing in our risk, compliance and technology infrastructure, and delivering best-in-class service to our customers.”

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Ben Lane is a reporter for HousingWire. Previously, he worked for TownSquareBuzz, a hyper-local news service. He is a graduate of University of North Texas.
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