Ocwen has been sued in Pennsylvania by a group of homeowners whose mortgage loans were serviced by Ocwen. The homeowners, including lead plaintiff Jill Dempsey, say that they paid off their mortgages in full, per a payoff quote from Ocwen, only to have Ocwen take far longer than the legally prescribed amount of time to file the loan satisfaction documents with the county clerk.
In Dempsey’s case, she paid off a home equity line of credit on her house so she could refinance her first mortgage. Pennsylvania law requires the servicer to file a “satisfaction piece” with the county within 60 days of the receipt of payment from the borrower. The satisfaction piece denotes that the loan has been paid off and the lien has been released.
Instead of filing the satisfaction piece with the Chester County Recorder’s Office within 60 days, as required by Pennsylvania’s Mortgage Satisfaction Act, Dempsey’s lawsuit alleges that Ocwen filed the satisfaction piece “approximately 253 days after plaintiff paid her loan in full,” which was 252 days after Dempsey’s first written request for Ocwen to send the satisfaction piece to the county.
Dempsey would subsequently send two other written requests to Ocwen without a response from the company. Ocwen “belatedly filed a satisfaction piece with the Chester County Recorder’s Office on March 21, 2014” which was approximately 198 days after Dempsey’s third written request.
“It’s not just an administrative matter,” says Eric Lechtzin, who is representing Dempsey and the rest of plaintiffs. “She was trying to refinance her home loan but was unable to refinance because records showed there was a second lien on the property. It exposed her to interest rate risk and a variety of things.”
According to the lawsuit, Ocwen reported Dempsey’s mortgage as “open” to credit agencies during the 60-day period following its receipt of her request for Ocwen to send the satisfaction piece to the county.
Dempsey’s suit claims she and the other plaintiffs suffered “economic harm and actual damages including, but not limited to, being unable to refinance the first lien mortgage on her home, being required to pay a greater amount of interest on her existing lien mortgage than she would have been required to pay had she been able to refinance this loan in July 2013, and the costs of bringing this instant lawsuit.”
The class action suit, which can read in full here, also claims that Ocwen violated the federal Real Estate Settlement Procedures Act by not filing the satisfaction piece with the county within 60 days of its receipt of a “qualified written request” to file the satisfaction piece from the borrower.