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Ocwen Acquisition Resulting in More Servicing Layoffs

For the second time in as many years, a mortgage servicing operation being acquired by Ocwen Financial Corp. will layoff hundreds of employees. The majority of Ocwen’s employees are outside the country.

Ocwen subsidiary Ocwen Loan Servicing LLC acquired HomEq Servicing in 2010 from Barclays Bank PLC.

After the deal was completed, Ocwen notified the State of California in a Worker Adjustment and Retraining Notification that 905 employees in North Highlands were laid off. In addition, a WARN notice filed with the North Carolina Department of Commerce indicated that Ocwen laid off 242 people in Wake County, N.C.

In October 2011, Ocwen disclosed that it had reached an agreement to acquire Saxon Mortgage Services Inc. from Morgan Stanley. The acquisition will cost Ocwen $59.3 million and is expected to close this month.

Saxon notified the Texas Workforce Commission on Thursday that it will layoff 454 employees in Fort Worth, Texas, on May 28.

In addition, another 226 employees in Irving, Texas, will be laid off on the same date.

Fitch Ratings previously reported that Ocwen’s mortgage servicing portfolio is expected to reach 910,000 loans for $145 billion after the Saxon acquisition. Since Fitch’s announcement, Ocwen has indicated that it will acquire sub-servicing on $15 billion in subprime mortgages from JPMorgan Chase & Co. also this month.

Fitch noted that around 80 percent of Ocwen’s staff is offshore.

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