PHH Corporation

PHH Corporation is an American financial-services company whose principal business became the outsourced origination and servicing of residential mortgages. The company was founded in 1946 in Mount Laurel, New Jersey, by Duane Peterson, Harley Howell, and Richard Heather. It was incorporated in Maryland in 1953 and developed a diversified service model that combined mortgage banking with employee-relocation services and commercial vehicle-fleet management. PHH historically operated across several business-to-business markets rather than primarily selling financial products directly to individual consumers. In mortgage services, it originated and serviced home loans for banks, mortgage lenders, and other large financial institutions. Its clients included major financial-services firms such as Morgan Stanley and HSBC Holdings. This outsourcing model made PHH an important infrastructure provider in the U.S. housing-finance system: partner institutions could use PHH's operational capabilities for loan processing, origination, servicing, and related administration without maintaining the entire platform internally. From 1997 until 2005, PHH was part of Cendant Corporation and its predecessors. During that period, the company continued to provide mortgage-banking services while also supporting employee relocations and vehicle-fleet programs. The fleet business served corporate customers and government agencies, principally in the United States and Canada. Its services included vehicle leasing, maintenance support, accident management, driver-safety programs, and fuel-card administration. A major strategic change occurred in 2005, when Cendant spun off PHH. On February 1 of that year, PHH began operating as an independent public company under the NYSE symbol PHH. The separation restored PHH's standalone corporate identity, although the business remained diversified across mortgage and mobility-related services for several years. PHH subsequently concentrated more heavily on mortgage services. On July 1, 2014, it sold its fleet-management business and related entities to Element Financial Corporation for approximately $1.4 billion. The transaction removed a substantial non-mortgage operating division and produced a reported net gain of $241 million in PHH's 2014 annual report. After the sale, the company's central identity was increasingly tied to mortgage origination and servicing performed for institutional clients. The mortgage business became the subject of significant regulatory litigation. In 2014, an administrative-law judge found that PHH had violated the Real Estate Settlement Procedures Act by referring consumers to mortgage insurers that paid reinsurance premiums to a PHH subsidiary. The matter escalated through the Consumer Financial Protection Bureau and the federal courts, producing disputes over the interpretation of RESPA, the applicable limitations period, the amount of any disgorgement, and the structure of the CFPB's director-removal protections. The D.C. Circuit later vacated the CFPB director's order in a panel decision, while the en banc court in 2018 rejected the panel's constitutional holding concerning the director's removal protection. On October 4, 2018, Ocwen Financial Corporation completed its acquisition of PHH for approximately $360 million. PHH ceased to be an independent NYSE-listed company and became a wholly owned Ocwen subsidiary. Glen A. Messina, who had been PHH's chief executive, became Ocwen's president and chief executive officer. PHH therefore remains principally relevant as a mortgage-servicing and origination platform within Ocwen rather than as a standalone listed diversified-services company.

PHH began in 1946 in Mount Laurel, New Jersey, where Duane Peterson, Harley Howell, and Richard Heather established the company that would become PHH Corporation. It was incorporated in 1953 as a Maryland corporation. From its early development, PHH pursued a multi-service business model spanning mortgage services, employee relocation, and vehicle-fleet operations. The mortgage division became the company's most enduring business. PHH provided mortgage-banking capabilities to other financial institutions, including loan origination, processing, and servicing. Rather than relying solely on a consumer-facing branch network, it operated as an outsourced platform for banks and large financial-services companies. This structure allowed client institutions to use PHH's infrastructure and personnel to administer residential loans. Between April 30, 1997, and February 1, 2005, PHH was a wholly owned subsidiary of Cendant Corporation and its predecessors. In addition to mortgage banking, PHH's businesses during this period included employee relocation and fleet management. The fleet division served corporate and government customers in the United States and Canada, offering leasing and operational services connected with vehicle maintenance, accident administration, fuel purchasing, and driver safety. Cendant spun off PHH on February 1, 2005, creating an independent publicly traded company. PHH traded on the New York Stock Exchange under the symbol PHH. The separation gave the company an independent capital-market identity while preserving its diversified service portfolio. The company's most consequential portfolio change followed in 2014. On July 1, PHH sold its fleet-management services business and associated fleet entities to Element Financial Corporation for approximately $1.4 billion. The transaction produced a reported net gain of $241 million and marked a substantial withdrawal from vehicle-fleet services. PHH thereafter focused more strongly on mortgage origination and servicing for institutional customers. PHH's mortgage activities also generated a major regulatory dispute. In November 2014, an administrative-law judge concluded that PHH had violated the Real Estate Settlement Procedures Act through a referral arrangement under which mortgage insurers paid reinsurance premiums to a PHH subsidiary. The judge imposed a $6.5 million fine. PHH appealed to the CFPB's director, Richard Cordray. In June 2015, Cordray adopted a broader statutory interpretation, concluded that the relevant limitations period did not restrict the CFPB, and ordered PHH to disgorge $109 million. The D.C. Circuit stayed the order in August 2015. In October 2016, a panel vacated and remanded the decision, criticizing the CFPB's order on due-process grounds. The panel also held that the statutory restriction on removing the CFPB director only for cause was unconstitutional. The case became an important administrative-law dispute as well as a regulatory matter affecting PHH. In January 2018, the en banc D.C. Circuit overturned the panel's constitutional holding and upheld the director's removal protection. Ocwen Financial Corporation completed its acquisition of PHH on October 4, 2018, for approximately $360 million. PHH's NYSE stock listing ended, and the company became a wholly owned Ocwen subsidiary. Glen A. Messina, PHH's former chief executive, became Ocwen's president and chief executive officer. The transaction ended PHH's period as an independent public company and placed its mortgage platform within Ocwen's broader servicing business.

1. 2018Ocwen completes acquisition

   Ocwen Financial Corporation acquires PHH, which becomes a wholly owned subsidiary and leaves the public market.

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2. 2014Fleet-management division is sold

   PHH sells its fleet-management operations to Element Financial Corporation for approximately $1.4 billion and reports a $241 million net gain.

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3. 2005PHH becomes an independent public company

   Following a Cendant spin-off, PHH begins independent operations and trades on the New York Stock Exchange under PHH.

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4. 1997PHH becomes part of Cendant

   PHH enters a period as a wholly owned subsidiary of Cendant Corporation and its predecessors.

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5. 1953PHH is incorporated in Maryland

   The business is incorporated as a Maryland corporation and continues developing mortgage, relocation, and fleet-related services.

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6. 1946PHH is founded in New Jersey

   Duane Peterson, Harley Howell, and Richard Heather establish the company in Mount Laurel, New Jersey.

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Business-to-business financial-services and mortgage-infrastructure provider, with a historical secondary position in employee relocation and commercial fleet management.

• Mortgage origination and servicingMortgage finance

  PHH's principal business has been providing outsourced residential mortgage origination, processing, and servicing for banks, mortgage lenders, and major financial institutions. The company has operated as an infrastructure provider, handling operational activities on behalf of client institutions rather than relying exclusively on a consumer-facing retail model.

• Fleet management servicesCommercial mobility services

  Before its 2014 divestiture, PHH's fleet business served corporations and government agencies in the United States and Canada. The offering included vehicle leasing, maintenance support, accident management, driver-safety training, and fuel-card services.

• Employee relocation servicesCorporate services

  PHH historically provided employee-relocation support as part of its broader business-services portfolio, helping corporate clients administer relocation programs alongside mortgage and mobility-related services.

• 2018Acquisition by Ocwen Financial CorporationM&A

  PHH was an independent mortgage-services company whose public listing and diversified historical portfolio had narrowed substantially after the fleet divestiture.

  What changed. Ocwen Financial Corporation completed the acquisition of PHH for approximately $360 million.

  Aftermath. PHH became a wholly owned Ocwen subsidiary, its NYSE listing ended, and Glen A. Messina moved into the chief executive role at Ocwen.

  Acquisition consideration. Approximately $360 million (2018)

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• 2014Divestiture of fleet-management operationsM&A

  PHH operated mortgage, relocation, and fleet businesses, but the company increasingly emphasized mortgage services.

  What changed. PHH sold its fleet-management business and related fleet entities to Element Financial Corporation for approximately $1.4 billion.

  Aftermath. The sale generated a reported $241 million net gain and left mortgage services as PHH's central operating focus.

  Purchase price. $1.4 billion (2014)

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• 2015CFPB disgorgement orderControversy

  CFPB Director Richard Cordray adopted a broader interpretation of the relevant RESPA provisions and ordered PHH to disgorge $109 million. The order was stayed and later vacated by a D.C. Circuit panel before the litigation produced further en banc rulings.

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• 2014RESPA referral and reinsurance disputeControversy

  An administrative-law judge found that PHH had violated the Real Estate Settlement Procedures Act by referring consumers to mortgage insurers that paid reinsurance premiums to a PHH subsidiary. The judge imposed a $6.5 million fine. The dispute later moved through the CFPB and federal courts.

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• 2018Ocwen Financial completes acquisition of PHH

  Ocwen Financial Corporation completed its acquisition of PHH for approximately $360 million. PHH became a wholly owned subsidiary and its NYSE listing was removed.

  M&ALeadership change
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• 2014PHH sells fleet-management business to Element Financial

  PHH completed the sale of its fleet-management operations and related entities to Element Financial Corporation, shifting its strategic emphasis toward mortgage services.

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1. PHH Corporation