Ocwen Financial Corp. came up shy of prior-quarter mortgage originations. The servicing portfolio also fell, and corporate earnings plunged.
From July 1 to Sept. 30, Ocwen closed 7,800 home loans for $1.315 billion, according to the company’s third-quarter earnings data.
New mortgage business fell just short of the second quarter, when 8,000 mortgages were funded for $1.326 billion.
Home loan production was better, however, than the 7,112 loans closed for $1.251 billion in the third-quarter 2014.
Altogether, Ocwen originated 22,300 loans for $3.753 billion in the first nine months of this year.
The most-recent home-loan production included 3,700 loans at $0.623 billion in correspondent acquisitions, 1,500 loans at $0.343 billion from the wholesale division, and 900 loans at $0.151 billion through the consumer-direct channel.
As well, an additional 1,700 reverse mortgages were closed for $0.199 billion through Ocwen’s subsidiary, Liberty Home Equity Solutions Inc.
Ocwen’s lock volume was at $1.4 billion, a slight increase from $1.3 billion in the prior financial period.
At the end of September 2015, the primary residential servicing portfolio slimmed to $238.108 billion from $267.996 billion three months earlier and $360.919 billion a year earlier.
As well, another $49.961 billion was sub-serviced as of the end of last month.
For the three months ended Sept. 30, 2015, Ocwen reported it closed mortgage servicing rights sales on $22 billion of unpaid principal balance.
As of Sept. 30, 2015, “loans held for investment — reverse mortgages” were at $2.320 billion, more than $2.097 billion as of June 30.
The company’s income before taxes swung to a $56 million loss from a $13 million profit in the second quarter. Still, the pre-tax income loss fared better than the $72 million loss, revised down, in the third-quarter 2014.
Ocwen said some of its income loss was due to “significant items” such as the $23 billion “interest rate driven GNMA impairment,” $30 billion in restructuring costs and monitoring charges, and $8 billion in payments “to New Residential in connection with downgrades to our Standard & Poor’s servicer ratings.” Also, Ocwen reported $11 billion worth of legacy servicing claim reserves and another $11 billion in legal and settlement expenses.
The Atlanta-based lender said its average U.S. third-quarter headcount was 1,882. Staffing dropped from 2,066 as of the second quarter and 2,445 as of the third quarter a year earlier.
In India and other offshore locations, the average employment at the end of September 2015 was 6,654.
Currently, Ocwen has 12 state examinations open on its servicing compliance and 20 state exams open on its lending compliance.