Credit rating agency Moody's Corp warned that mortgage servicers such as Ocwen Financial Corp could be pushed into subprime lending as their core business comes under increased regulatory scrutiny. The rapid growth of mortgage servicers since the subprime crisis has drawn the attention of state and federal regulators who are concerned about the companies' capacity to collect mortgage payments in large volumes.Earlier this month, Ocwen said New York's banking regulator halted its purchase of servicing rights on a portfolio of mortgages from Wells Fargo & Co with a total principal balance of $39 billion.Moody's in a research note said it was concerned over the possibility that the companies would attempt to offset a decrease in growth by shifting business models and originating subprime mortgages, which would be a net credit negative.Servicers get paid by loan owners, typically banks or investors, to collect mortgage payments and handle delinquencies and foreclosures.
Moody?s Corporation (Moody?s) is a provider of credit ratings; credit, capital markets and economic related research, data and analytical tools; software solutions and related risk management services; quantitative credit risk measures, financial services training and certification services, and outsourced research and analytical services to institutional customers. Shares of MCO fell by 0.52% or $-0.41/share to $78.35. In the past year, the shares have traded as low as $47.35 and as high as $85.70. On average, 928323 shares of MCO exchange hands on a given day and today's volume is recorded at 995098.
Ocwen Financial Corporation is a financial services holding company. Shares of OCN traded higher by 1.33% or $0.52/share to $39.52. In the past year, the shares have traded as low as $33.54 and as high as $60.18. On average, 2762240 shares of OCN exchange hands on a given day and today's volume is recorded at 4365975.
Source
