Ocwen Financial Corporation (NYSE: OCN) announced late Tuesday that it could potentially sell its reverse mortgage lending arm, Liberty Home Equity Solutions.
“The company is currently evaluating its long-term strategy with respect to its reverse lending activities, including the potential sale of the reverse lending business or some assets of the business,” the company said in an 8-K filing.
The move would allow Ocwen to focus on mortgage servicing and retail forward lending in the future, the company said.
The West Palm Beach, Fla.-based company earlier this month announced that it was shutting down its forward-loan wholesale operation, but that its forward retail and reverse mortgage channels would remain unaffected. Michael Kent, Liberty’s president, told RMD just this week that it was business as usual at the reverse mortgage lender, which was looking into growing its correspondent, retail, and wholesale channels going into the future.
“Ocwen’s our parent, but we maintain a separate business from our parent,” Michael Kent told RMD. “We run our own business operations. We’re for all practical purposes a standalone, fully-functioning corporate entity.”
Ocwen has suffered multiple setbacks this year, including a wave of enforcement actions regarding its servicing operations and a lawsuit from the Consumer Financial Protection Bureau over a host of alleged violations, including illegal foreclosures and the mishandling of escrow accounts.
The servicer and lender has retained Barclays Capital, Inc. to help advise on “alternatives” for its reverse mortgage assets, Ocwen said in the filing.
Liberty took fourth place in Reverse Market Insight’s most recent list of top 100 lenders, tallying 5,170 endorsements during the 12 months ended August for a 5.6% market share.
Written by Alex Spanko
