Ocwen Financial Corporation Launches Asset Recovery and REO Management Services
New Third Party Services Meet the Needs of Clients by Bringing Value to Non-Income Producing Assets
WEST PALM BEACH, Fla., Oct. 26, 2000 -- Ocwen Financial Corporation (NYSE:OCN), one of the leading mortgage servicing and resolution companies in the United States, announces the launch of Asset Recovery and REO Management Services.
"These new offerings represent Ocwen's commitment to providing an array of products and services that meet the individual needs of each and every one of our clients," said William C. Erbey, Chairman and CEO for Ocwen Financial Corporation. "We are essentially unbundling our core servicing processes to enable our customers to select those specific services that create the most value for them. Our clients continue to focus on improving efficiencies in regards to non-income producing assets, and they need servicers who are proven successful in providing quick resolution and a high value of return."
"Our Asset Recovery and REO Management programs are based on the experience and technology we've gained in managing our own portfolio for more than a decade," added Erbey. "We saw it as a natural transition for Ocwen to offer these services to third parties."
Ocwen's Asset Recovery Group services charged-off assets including second or high loan to value (HLTV) loans, mortgage deficiencies and credit card debt. The Asset Recovery Group program provides for a seamless transfer and boarding of loans and servicing fees are determined by the amount recovered.
"Ocwen is one of the few firms that is able to offer this type of service on a contingency fee basis, which is a tremendous advantage for lenders," said John R. Van Cora, Director of Business Development for Ocwen. "Institutions that were once able to sell charged-off assets for 10 to 15 cents on the dollar are now receiving as little as 2 to 4 cents. Our Asset Recovery Group provides an alternative that can add to our clients' bottom line."
Ocwen currently services over $11 billion in management intensive mortgage assets and is pursuing collections on over $600 million in deficiencies and delinquent unsecured debt. Ocwen's "high touch" servicing platform combines specialized staff training with proprietary software and loss mitigation and collection technology.
Through a nationwide network of REO resolution staff, Ocwen's REO Management Services Team directs the entire sales process on foreclosed properties. This process includes providing property value assessments from an independent appraiser and a broker price opinion, contracting local builders for repairs, hiring a realtor, negotiating the final sale price and closing the transaction.
The REO process is monitored through the REAL-e(tm) system, a residential workflow management software package that tracks the foreclosed property from the time it becomes REO through the property's sale and financial close. Developed by Ocwen Technology Xchange, Inc., the REAL-e system is a comprehensive software solution that manages the entire lifecycle of a residential loan.
"Time is not on a lender's side when a property has been reduced to REO. It costs an average of 1.5% of the property value each month to carry the property," said Michael Short, Vice President of Business Development for Ocwen. Ocwen's current average time between a property becoming REO and receipt of sales proceeds is 5.1 months.
Ocwen's Asset Recovery Group and REO Management Team are divisions of Ocwen Federal Bank FSB, a subsidiary of Ocwen Financial Corporation. Headquartered in West Palm Beach, Fla., Ocwen Financial Corporation is a financial services company whose primary businesses are the servicing and resolution of subperforming and nonperforming residential and commercial mortgage loans. Ocwen also specializes in the development of related loan servicing technology and software for the mortgage and real estate industries. Additional information about Ocwen Financial Corporation is available at www.ocwen.com.
Certain statements contained herein are not based on historical facts and are "forward-looking statements" within the meaning of the Federal securities laws. These statements may be identified by reference to a future period(s) or by the use of forward-looking terminology such as future or conditional verb tenses, similar terms, variations on such terms or negatives of such terms. Actual results could differ materially from those indicated in such statements due to risks, uncertainties and changes with respect to a variety of factors, including national, regional or local economic environments, government fiscal and monetary policies, prevailing interest rates, competitive pricing and conditions, loan servicing effectiveness, competitive products, pricing and conditions (including from competitors that have significantly greater resources than OCN), fulfillment of agreed upon terms and conditions of closing or performance, timing of transaction closings, software integration, development and licensing effectiveness, damage to the Company's computer equipment and the information stored in its data centers, real estate markets in general, and other risks detailed from time to time in the Company's or its subsidiaries' reports and filings with the Securities and Exchange Commission, including periodic reports on Forms 10-Q, 8-K and 10-K, including Exhibit 99.1 attached to the Company's Form 10-K for the year ended December 31, 1999.
CONTACT: Ocwen Financial Corporation
Michael Short, V.P. Business Development