Moreover, borrowers who have seen their home values rise over the past two to three years are refinancing at higher loan levels, indicating an increase in “cash-outs.”
Ocwen “caused significant harm” to these homeowners by backdating denial letters in response to proper requests for lower monthly payments, the regulator said.
CoreLogic’s newly released analysis of homes lost shows 45,000 foreclosures were completed in August 2014. That’s a 22.2 percent year-over-year decline from 58,000 in August 2013.
The bank took too much time to process borrowers’ applications for foreclosure relief, failed to tell borrowers when their applications were incomplete, denied loan modifications to qualified borrowers, and illegally delayed finalizing permanent loan modifications, the CFPB alleges.
It showed that 12.7 percent of loans modified in 2013 re-defaulted after six months. That’s compared to a 32.2 percent re-default rate in 2009.
Foreclosure filings are still down 9 percent from a year ago — but it’s the smallest decrease in the last 47 consecutive months of year-over-year declines in U.S. foreclosure activity, RealtyTrac reported Thursday.
The FHFA is currently testing a program in Detroit where Fannie and Freddie would, in partnership with nonprofit companies, lower principal on homes in some of the hardest-hit communities.
The continuing slide in foreclosures is a positive sign for the overall housing market, although the monthly rate is still more than double compared with the years before the financial crisis.
Consumer advocates say those who have already lost theirs homes to a foreclosure or a short sale will likely benefit very little, if at all.
Bank of America is on the verge of finalizing a reported $17 billion settlement with the U.S. government over the packaging and selling of bad mortgages, and it would be the biggest single hit taken by a big bank since the financial crisis.