Ocwen Financial Corp. agreed to sell another $25 billion of mortgage servicing rights to Nationstar Mortgage Holdings.
The announcement comes just hours after the company disclosed late Monday that it that it had been threatened with a possible delisting by the New York Stock Exchange for failing to file its 2014 annual financial statement on time, and that it wasn’t sure when it would be able to file the statement.
The sale of servicing rights on a portfolio consisting of approximately 142,000 loans owned by Freddie Mac and Fannie Mae is subject to approvals by Freddie Mac, Fannie Mae and the their regulator, the Federal Housing Finance Agency; Ocwen and Nationstar expect the transaction to close before mid-year.
The latest deal follows an agreement to sell a $9.8 billion portfolio of mortgage servicing rights to Nationstar reached in February. Earlier this month, Ocwen also reached an agreement to sell a $9.6 billion portfolio to GreenTree, a unit of Walter Investment Management.
"This transaction, on top of the one announced in February between Ocwen and Nationstar, furthers our announced corporate strategy and demonstrates the strong working relationship we have developed with Nationstar," Ron Faris, chief executive of Ocwen, said in a press release.
Jay Bray, chief executive of Nationstar, said in the same press release that the company would continue to work with Ocwen as it evaluate the sale of additional agency portfolios.
The nonbank servicer has been selling off its servicing of Fannie Mae and Freddie Mac mortgages to focus on servicing private-label mortgages. The sales also generates cash for the Ocwen, which faces a series of challenges from regulators and investors in the mortgages that it services. In December the company agreed in December to pay $150 million, and William Erbey, its executive chairman, agreed to step down after New York State’s Department of Financial Services alleged Ocwen had engaged in improper servicing practices for distressed-mortgage borrowers and had questionable dealings with affiliated companies.
Ocwen said the principal reason it had missed deadlines to make the disclosures was because it needed more time “to analyze and review” an affiliated company, Home Loan Servicing Solutions, that finances its purchases of mortgage-servicing rights. Ocwen is looking into whether HLSS has the “ability to continue to meet its obligations to fund new servicing advances.”
Ocwen didn’t provide any explanation of HLSS financial condition, but said that a “a failure by HLSS to fund new servicing advances could have a material negative impact” on Ocwen’s financial condition