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92 STATE OF AFFAIRS: WEST » $369 million to California homeowners. Both groups offered to sit down with the governor to help work out a solution to the conflict outside of court. "Although we did not take any position publicly regarding your position to take the money from the settlement because of the budget deficit, we were quite concerned that a community that had no powerful representa- tives would be deprived of a very substantial sum of money that would adversely affect millions of California homeowners in distress and further weaken homeowners in distress as they faced foreclosures and the need for loan modifications and other graceful exit strategies," Operation HOPE stated in its letter. e letter went on to mention the state's multibillion-dollar budget surplus this year. Gov. Brown could not be reached for comment. Ocwen to Pay $2.1B to 49 States e California Department of Business Oversight, along with 48 other states, reached a settlement with Ocwen Financial Corpora- tion and Ocwen Loan Servicing, according to a press release issued by the department. e $2.1 billion settlement was in response to violations regarding mortgage servicing laws. "e agreement calls for $2 billion in loan modification relief in the form of principal re- ductions for homeowners in default or at risk of foreclosure. e settlement also provides for $127.3 million in cash payments to bor- rowers whose home was sold in a foreclosure proceeding from January 1, 2009, to Decem- ber 31, 2012," the department said in a release. California's share of the settlement is estimated at $268 million. e lawsuit stems from Ocwen's acquisi- tion of two mortgage servicers, Litton Loan Servicing L.P. and Homeward Residential Inc., in 2011 and 2012, respectively. Ocwen was liable for prior malfeasance. "As described in the allegations below, the servicers' misconduct resulted in premature and unauthorized foreclosures, violation of homeowners' rights and protections, and the use of false and deceptive affidavits and other documents," the settlement said. e complaint was filed against Ocwen in federal court by 49 state attorneys general and the Consumer Financial Protection Bureau. One hundred percent of the settlement proceeds are earmarked to directly benefit consumers—no payments will go to the federal government or any states. "Californians should not lose their homes because of deceptive and poorly executed mortgage servicing practices," said Jan Lynn Owen, the state of California's Commissioner of Business Oversight. "e Department of Business Oversight strives to identify and hold accountable mortgage companies that violate state and federal laws. is settlement provides needed relief to affected California homeowners." Ocwen could not be reached for com- ment. California Loses Jobs in January A report issued by the Wells Fargo Economics Group noted that California lost 31,600 jobs in January—the largest single- month decline in more than four years. Non-farm payrolls dropped 0.2 percent during the month of January. e decline from December 2013 to January 2014 was the largest one-month drop since September 2009. However, the report notes a few factors that helped assuage some of the economic pain experienced by California, commenting, "Part of the sting from that decline was offset by a significant upward revision to job growth during the previous year." e Wells Fargo Economics Group posits that much of January's job decline was precipitated by seasonal factors, specifically job losses in the information sector. A decline of 12,700 information sector jobs was reported by the group, mainly in the state's volatile motion picture business. Retail trade jobs tumbled as well, losing 14,300 jobs. Government, construction, and the leisure and hospitality sector also rounded out major industries experiencing job losses. Although experiencing a loss of jobs, the unemployment rate declined further in Janu- ary. e report noted, "January's 0.2-percent- age-point drop in California's unemployment rate is another reason not to give too much credence to the one-month drop in nonfarm payrolls." When considered on a yearly timeline, non-farm payrolls increased 2.6 percent, with 391,700 new jobs created in 2013. e report was cautious to note, "e civilian labor force is still down on a year-to- year basis, however, which likely reflects the frustration some job seekers have had finding meaningful work." Rising Home Prices Shrink California Distressed Sales e California Association of Realtors (CAR) released a new report, revealing sales of distressed homes have plummeted in the past five years. e report comments that sales of distressed homes have shrunk due to rising home prices. In January 2009, 69.5 percent of all homes sold in California were distressed, which in- cluded short sales and REO. e report notes that five years later, distressed home sales made up only 15.6 percent of sold homes. During the same time period, the report stated, "California's median home price has soared more than 64 percent from $249,960 in January 2009 to $410,990 in January 2014." "e dramatic drop in the share of distressed sales throughout the state reflects a market that is fully transitioning from the housing downturn," said CAR President Kevin Brown. "Significant home price appre- ciation over the past five years has lifted the market value of many underwater homes, and as a result, many homeowners have gained significant equity in their homes, resulting in fewer short sales and foreclosures." Statewide, the share of equity sales hit a high of 86.4 percent in November 2013 and has been above 80 percent for the past seven months. Stainslaus County was one of the hardest- hit counties, experiencing a distressed market of 93.6 percent in 2009. e market has since shrunk to 24.8 percent in Stanislaus County. San Joaquin County's share of distressed sales made up 93 percent of available homes; that figure has since dropped to 25.1 percent. The amount received in the settlement on behalf of California homeowners, $369 million of which was earmarked for counseling and other homeowner assistance but allegedly wound up in the state's general fund. Source: COR Community Development Corporation STAT INSIGHT $410 million