By Chelsey Dulaney
Ocwen Financial Corp. disclosed Monday that it is negotiating
with lenders to extend and refinance some of its debt.
In a regulatory filing, the embattled mortgage-servicing company
said it looking to renew, replace or extend debt arrangements that
mature or begin amortization this year. The company said it is also
considering selling and financing advance receivables.
The company warned if it is unable able to change the debt
arrangements, it could face a liquidity crunch.
"Due to the significant level of cash requirements related to
servicing advances, we may not have sufficient levels of liquidity
to fund the operations without our advance financing facilities,"
the company said in the filing.
Ocwen has been plagued by regulatory problems and other
challenges for the past two years, including a December settlement
with New York state regulators over alleged improper servicing
practices for distressed borrowers. The company had delayed filing
its 10-K over problems related to the financial status of its Home
Loan Servicing Solutions Ltd. affiliate, which had put it in
jeopardy of having its shares delisted from the New York Stock
Exchange.
The company is trying to cut its risk exposure by selling off
servicing rights for mortgages owned by government-supported Fannie
Mae and Freddie Mac.
Earlier this month, the company said it had avoided a "going
concern" opinion from its auditor that could have raised questions
about the company's ability to survive--a move that Ocwen said
indicates it is on the rebound.
Write to Chelsey Dulaney at Chelsey.Dulaney@wsj.com
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