SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                            SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
                                (Amendment No. )

Filed by the Registrant |x|
Filed by a Party other than the Registrant |_|

Check the appropriate box:

|_| Preliminary Proxy Statement
|_| Confidential, for use of the Commission Only
    (as permitted by Rule 14a-6(e)(2))
|x| Definitive Proxy Statement
|_| Definitive Additional Materials
|_| Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12

                          OCWEN FINANCIAL CORPORATION
________________________________________________________________________________
                (Name of Registrant as Specified In Its Charter)

________________________________________________________________________________
                   (Name of Person(s) Filing Proxy Statement)

Payment of Filing Fee (Check the appropriate box):

|x| No fee required
|_| Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.

1) Title of each class of securities to which transaction applies:

   _____________________________________________________________________________

2) Aggregate number of securities to which transaction applies:

   _____________________________________________________________________________

3) Per unit price or other underlying value of transaction computed
   pursuant to Exchange Act Rule 0-11 (set forth the amount on which the filing
   fee is calculated and state how it was determined):

   _____________________________________________________________________________

4) Proposed maximum aggregate value of transaction:

   _____________________________________________________________________________

5) Total fee paid:

   _____________________________________________________________________________

|_| Check box if any part of the fee is offset as provided by
    Exchange Act Rule 0-11(a)(2) and identify the filing for which
    the offsetting fee was paid previously.  Identify the previous
    filing by registration statement number, or the form or schedule
    and the date of its filing.

    1) Amount previously paid: _________________________________________________

    2) Form, Schedule or Registration No. ______________________________________

    3) Filing party: ___________________________________________________________

    4) Date filed: _____________________________________________________________

___________

(032796DTI)


<PAGE>

 
                                 March 31, 1998
 
Dear Fellow Shareholder:
 
     On behalf of the Board of Directors, I cordially invite you to attend the
Annual Meeting of Shareholders of Ocwen Financial Corporation to be held at the
first floor offices of the Company located at 1675 Palm Beach Lakes Boulevard,
West Palm Beach, Florida 33401, on Wednesday, May 13, 1998 at 9:00 a.m., Eastern
Time. The matters to be considered by shareholders at the Annual Meeting are
described in detail in the accompanying materials.
 
     IT IS VERY IMPORTANT THAT YOU BE REPRESENTED AT THE ANNUAL MEETING
REGARDLESS OF THE NUMBER OF SHARES YOU OWN OR WHETHER YOU ARE ABLE TO ATTEND THE
ANNUAL MEETING IN PERSON. Let me urge you to mark, sign and date your proxy card
today and return it in the envelope provided, even if you plan to attend the
Annual Meeting. This will not prevent you from voting in person, but will ensure
that your vote is counted if you are unable to attend.
 
     Your continued support of and interest in Ocwen Financial Corporation are
sincerely appreciated.
 
                                          Sincerely,
 
                                          WILLIAM C. ERBEY
                                          Chairman and Chief Executive Officer

<PAGE>
                          OCWEN FINANCIAL CORPORATION
                        1675 Palm Beach Lakes Boulevard
                         West Palm Beach, Florida 33401
 
                            ------------------------
 

                    NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
                           TO BE HELD ON MAY 13, 1998
 
                            ------------------------
 
     NOTICE IS HEREBY GIVEN, that the Annual Meeting of Shareholders of Ocwen
Financial Corporation (the "Company") will be held at the first floor offices of
the Company located at 1675 Palm Beach Lakes Boulevard, West Palm Beach, Florida
33401 on Wednesday, May 13, 1998 at 9:00 a.m., Eastern Time, for the following
purposes:
 
          1. To elect five directors for a one-year term and until their
             successors are elected and qualified;
 
          2. To adopt the Ocwen Financial Corporation 1998 Annual Incentive
             Plan;
 
          3. To adopt the Ocwen Financial Corporation Long-Term Incentive Plan;
 
          4. To ratify the appointment by the Board of Directors of Price
             Waterhouse LLP as the independent auditor of the Company for the
             fiscal year ending December 31, 1998; and
 
          5. To transact such other business as may properly come before the
             meeting and any adjournment thereof (management is not aware of any
             such other business).
 
     The Board of Directors has fixed March 15, 1998 as the record date for the
determination of shareholders entitled to notice of and to vote at the Annual
Meeting and any adjournment thereof. Only shareholders of record at the close of
business on that date will be entitled to vote at the Annual Meeting or any
adjournment thereof.
 
                                          By Order of the Board of Directors,
 
                                          JOHN R. ERBEY
                                          Secretary
 
West Palm Beach, Florida
M
arch 31, 1998

<PAGE>
                          OCWEN FINANCIAL CORPORATION
 
                            ------------------------
 
                                PROXY STATEMENT
 
                            ------------------------
 
                         ANNUAL MEETING OF SHAREHOLDERS
 
     This Proxy Statement is being furnished to holders of the common stock, par
value $.01 per share (the "Common Stock"), of Ocwen Financial Corporation, a
Florida corporation (the "Company"). Proxies are being solicited on behalf of
the Board of Directors of the Company to be used at the Annual Meeting of
Shareholders (the "Annual Meeting") to be held at the first floor offices of the
Company located at 1675 Palm Beach Lakes Boulevard, West Palm Beach, Florida
33401, on Wednesday, May 13, 1998 at 9:00 a.m., Eastern Time, and at any
adjournment thereof, for the purposes set forth in the Notice of Annual Meeting
of Shareholders. This Proxy Statement and the accompanying proxy card (the
"Proxy") are first being mailed to shareholders on or about March 31, 1998.
 
     The Proxy solicited hereby, if properly signed and returned to the Company
and not revoked prior to its use, will be voted in accordance with the
instructions contained therein. If no contrary instructions are given, each
Proxy received will be voted: (i) for the nominees for director described
herein; (ii) for approval of the Ocwen Financial Corporation 1998 Annual
Incentive Plan (the "1998 Annual Incentive Plan"); (iii) for approval of the
Ocwen Financial Corporation Long-Term Incentive Plan (the "Long-Term Incentive
Plan"); (iv) for the ratification of the appointment of Price Waterhouse LLP as
the independent auditor of the Company for the fiscal year ending December 31,
1998; and (v) upon the transaction of such other business as may properly come
before the meeting, in accordance with the judgment of the persons appointed as
proxies.
 
     Any shareholder giving a Proxy has the power to revoke it at any time
before it is exercised by: (i) filing written notice thereof with the Secretary
of the Company, 1675 Palm Beach Lakes Boulevard, West Palm Beach, Florida 33401;
(ii) submitting a properly executed Proxy bearing a later date; or (iii)
appearing at the Annual Meeting and giving the Secretary notice of his or her
intention to vote in person. Proxies solicited hereby may be exercised only at
the Annual Meeting and any adjournment thereof and will not be used for any
other meeting.
 
                                     VOTING
 
     Only holders of record of Common Stock at the close of business on March
15, 1998 (the "Voting Record Date") will be entitled to vote at the Annual
Meeting or any adjournment thereof. On the Voting Record Date, there were
60,708,520 shares of Common Stock issued and outstanding, and the Company had no
other class of equity securities outstanding. (All information relating to the
number and price of shares of Common Stock contained in this Proxy Statement has
been adjusted to reflect the two-for-one split of the Common Stock in November
1997.) Each share of Common Stock is entitled to one vote at the Annual Meeting
on all matters properly presented thereat.
 
     Assuming the presence of a quorum, the five persons receiving the greatest
number of votes of the Common Stock cast at the Annual Meeting by the holders of
stock entitled to vote shall be elected as directors of the Company. Assuming
the presence of a quorum, the proposals to adopt the 1998 Annual Incentive Plan
and the Long-Term Incentive Plan and to ratify the appointment of Price
Waterhouse LLP as the Company's independent auditor for 1998 and any other
matter properly submitted to shareholders for their consideration at the Annual
Meeting (other than the election of directors) shall be approved if the votes
cast by the holders of the shares represented at the Annual Meeting and entitled
to vote on the subject matter favoring the action exceed the votes cast opposing
the action.
 
                                       1

<PAGE>
     With regard to the election of directors, shareholders may vote in favor of
or withhold authority to vote for one or more nominees for director. Votes that
are withheld in connection with the election of one or more nominees for
director will not be counted as votes cast for such individuals and accordingly
will have no effect. Abstentions may be specified on all other proposals.
Abstentions will not be counted in determining the votes cast in connection with
the proposals to adopt the 1998 Annual Incentive Plan and the Long-Term
Incentive Plan and to ratify the appointment of the Company's independent
auditor and, thus, will have no effect on such proposals.
 
     The election of directors and the proposal to ratify the Company's
independent auditor are considered "discretionary" items upon which brokerage
firms may vote in their discretion on behalf of their clients if such clients
have not furnished voting instructions within ten days of the Annual Meeting.
The proposals to adopt the 1998 Annual Incentive Plan and the Long-Term
Incentive Plan are considered "non discretionary" items for which there may be
broker nonvotes at the Annual Meeting. Because of the required votes, broker
nonvotes will have no effect on the vote on the proposals.
 
     The presence at the Annual Meeting of a majority of the votes entitled to
be cast, represented in person or by proxy, will constitute a quorum for the
transaction of business at the Annual Meeting.
 
                             ELECTION OF DIRECTORS

                                 (PROPOSAL ONE)
 
     The Company's Bylaws provide that the Board of Directors of the Company
shall be comprised of between three and seven members, with the exact number to
be fixed by the Board of Directors. A resolution adopted by the Board of
Directors pursuant to the Company's Bylaws has established the number of
directors at five. Directors are elected annually and hold office until the
earlier of the election and qualification of their successors or their
resignation and removal.
 
     Each of the five persons standing for election at the Annual Meeting is
currently a director of the Company. There are no arrangements or understandings
between any nominee for director and any other person pursuant to which such
person was selected as a nominee. William C. Erbey, Chairman of the Board and
Chief Executive Officer, and John R. Erbey, Managing Director and Secretary, are
brothers. Otherwise, no director is related to any other director or executive
officer of the Company by blood, marriage or adoption.
 
     If any person named as nominee should be unable or unwilling to stand for
election at the time of the Annual Meeting, the person or persons appointed as
proxies will nominate and vote for a replacement nominee or nominees recommended
by the Board of Directors. At this time, the Board of Directors knows of no
reason why any of the nominees listed below would not be able to serve as a
director if elected.
 
NOMINEES FOR DIRECTOR
 
     The following table sets forth certain information concerning the five
nominees for director.
 

<TABLE>
<CAPTION>
                                                                   DIRECTOR
NAME                                                   AGE(1)       SINCE
- ----                                                   ------      --------
<S>                                                    <C>         <C>
William C. Erbey.....................................    48          1988
Hon. Thomas F. Lewis.................................    73          1997
W.C. Martin..........................................    49          1996
Howard H. Simon......................................    57          1996
Barry N. Wish........................................    56          1988
</TABLE>

 
- ------------------
            (1) As of March 15, 1998.
 
                                       2

<PAGE>
     William C. Erbey.  Mr. Erbey has served as President and Chief Executive
Officer of the Company since January 1988, as Chief Investment Officer of the
Company since January 1992, and as Chairman of the Board of Directors of the
Company since September 1996. Mr. Erbey has served as Chairman of the Board of
Ocwen Federal Bank FSB (the "Bank"), a subsidiary of the Company, since February
1988 and as President and Chief Executive Officer of the Bank since June 1990.
Mr. Erbey also has served since May 1997 as Chairman, Chief Executive Officer
and Treasurer of Ocwen Asset Investment Corp. ("OAIC"), a publicly held real
estate investment trust whose operating strategies are managed by a wholly owned
subsidiary of the Company (but which is subject to the supervision of OAIC's
Board of Directors), and serves as a director and officer of many subsidiaries
of the Company and of OAIC. From 1983 to 1995, Mr. Erbey served as a Managing
General Partner of The Oxford Financial Group ("Oxford"), a private investment
company, in charge of merchant banking. From 1975 to 1983, Mr. Erbey served at
General Electric Capital Corporation ("GECC") in various capacities, most
recently as President and Chief Operating Officer of General Electric Mortgage
Insurance Corporation, a subsidiary of the General Electric Company engaged in
the mortgage insurance business. Mr. Erbey also served as program general
manager of GECC's Commercial Financial Services Department and its subsidiary,
Acquisition Funding Corporation.
 
     Hon. Thomas F. Lewis.  Mr. Lewis has served as a director of the Company
since May 1997. Mr. Lewis served as a United States Congressman, representing
the 12th District of Florida from 1983 to 1995. Mr. Lewis served in the House
and Senate of the Florida State Legislature at various times. Mr. Lewis is a
principal of Lewis Properties, Vice President of Marian V. Lewis Real Estate and
Investments and a director of T&M Ranch & Nursery. Mr. Lewis currently is
Chairman of the Board of Directors of the U.S. Department of Veterans Affairs
Research Foundation. He also is a member of the Economic Council of Palm Beach
County. Mr. Lewis formerly served as a United States delegate to the North
Atlantic Treaty Organization and as a member of the President's Advisory
Commission on Global Trade Policies.
 
     W.C. Martin.  Mr. Martin has served as a director of the Company and of the
Bank since July 1996 and June 1996, respectively. Since 1982, Mr. Martin has
been associated with Holding Capital Group ("HCG") and has been engaged in the
acquisition and turnaround of businesses in a broad variety of industries. Since
March 1993, Mr. Martin also has served as President and Chief Executive Officer
of SV Microwave, a company he formed along with other HCG investors to acquire
the assets of the former Microwave Division of Solitron Devices, Inc. Prior to
1982, Mr. Martin was a Manager in Touche Ross & Company's Management Consulting
Division, and prior to that, he held positions in financial management with
Chrysler Corporation.
 
     Howard H. Simon.  Mr. Simon has served as a director of the Company since
July 1996. Mr. Simon is the Managing Director of Simon, Master & Sidlow, P.A., a
certified public accounting firm which Mr. Simon founded in 1978 and which is
based in Wilmington, Delaware. He has served as a director of the Bank since
1987. Mr. Simon is a past Chairman and current member of the Board of Directors
of CPA Associates International, Inc. Prior to 1978, Mr. Simon was a Partner of
Touche Ross & Company.
 
     Barry N. Wish.  Mr. Wish has served as Chairman, Emeritus of the Board of
Directors of the Company since September 1996 and as a director of the Bank
since February 1988. Mr. Wish served as Chairman of the Board of the Company
from January 1988 to September 1996. From 1983 to 1995, Mr. Wish served as a
Managing General Partner of Oxford, which he founded. From 1979 to 1983, he was
a Managing General Partner of Walsh, Greenwood, Wish & Co., a member firm of the
New York Stock Exchange. Prior to founding that firm, Mr. Wish was a Vice
President and shareholder of Kidder, Peabody & Co., Inc.
 
 
    THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE FOR
THE NOMINEES FOR DIRECTOR.
 
                                       3

<PAGE>
             MEETINGS OF THE BOARD OF DIRECTORS AND ITS COMMITTEES
 
     The Board of Directors of the Company held a total of ten meetings during
1997. No director of the Company attended fewer than 75% of the aggregate total
number of meetings of the Board of Directors held while he was a member of the
Board of Directors during 1997 and the total number of meetings held by all
committees thereof during the period which he served on such committees during
1997.
 
     The Board of Directors of the Company has established an Executive
Committee, an Audit Committee and a Nominating and Compensation Committee. A
brief description of these committees is set forth below.
 
     The Executive Committee acts on behalf of the Board of Directors on matters
when the full Board of Directors is not in session. Currently, the members of
the Executive Committee are Directors Erbey (Chairman) and Wish. This committee
met seven times during 1997.
 
     The Audit Committee of the Board of Directors reviews and advises the Board
of Directors with respect to reports by the Company's independent auditor and
monitors the Company's compliance with laws and regulations applicable to the
Company's operations. Currently, the members of the Audit Committee are
Directors Simon (Chairman), Lewis and Martin. This committee met three times
during 1997.
 
     The Nominating and Compensation Committee evaluates and makes
recommendations to the Board of Directors for the election of directors. The
Nominating and Compensation Committee also administers personnel and
compensation matters relating to the executive officers of the Company. The
Nominating and Compensation Committee will consider nominees for director
recommended by shareholders, but has not adopted any procedures to be followed
by shareholders in submitting such recommendations. Currently, the members of
the Nominating and Compensation Committee are Directors Martin (Chairman), Lewis
and Simon. This committee met three times during 1997.
 
                        BOARD OF DIRECTORS COMPENSATION
 
     Pursuant to the Directors Stock Plan adopted by the Board of Directors and
shareholders of the Company in July 1996, the Company compensates directors by
delivering a total annual value of $10,000 payable in shares of Common Stock
(which may be prorated for a director serving less than a full one-year term, as
in the case of a director joining the Board of Directors after an annual meeting
of shareholders), subject to review and adjustment by the Board of Directors
from time to time. Such payment is made after the annual organizational meeting
of the Board of Directors which follows the annual meeting of shareholders of
the Company. An additional annual fee payable in shares of Common Stock, which
currently amounts to $2,000, subject to review and adjustment by the Board of
Directors from time to time, is paid to committee chairs after the annual
organizational meeting of the Board of Directors. During 1997, an aggregate of
1,876 shares of Common Stock was granted to the five directors of the Company
and the three committee chairs.
 
     The number of shares issued pursuant to the Directors Stock Plan is based
on their "fair market value" on the date of grant. The term "fair market value"
is defined in the Directors Stock Plan to mean the average of the high and low
prices of the Common Stock as reported on the New York Stock Exchange ("NYSE")
on the relevant date.
 
     Shares issued pursuant to the Directors Stock Plan, other than the
committee chair fee shares, are subject to forfeiture during the 12 full
calendar months following election or appointment to the Board of Directors if
the director does not attend an aggregate of at least 75% of all meetings of the
Board of Directors and committees thereof of which he is a member during such
period.
 
                                       4

<PAGE>
                    EXECUTIVE OFFICERS WHO ARE NOT DIRECTORS
 
     The following table sets forth certain information with respect to each
person who currently serves as an executive officer of the Company but does not
serve on the Company's Board of Directors. Executive officers of the Company are
elected annually by the Board of Directors and generally serve at the discretion
of the Board. There are no arrangements or understandings between the Company
and any person pursuant to which such person was elected as an executive officer
of the Company. Other than William C. Erbey and John R. Erbey, who are brothers,
no director or executive officer is related to any other director or executive
officer of the Company or any of its subsidiaries by blood, marriage or
adoption.
 

<TABLE>
<CAPTION>
NAME                             AGE(1)      POSITION
- ----                             ------      --------
<S>                              <C>         <C>
John R. Barnes.................    55        Senior Vice President
Joseph A. Dlutowski............    33        Senior Vice President, Assistant Secretary
                                             and Stock Compliance Officer
John R. Erbey..................    57        Managing Director, Secretary
                                             and General Counsel
Robert E. Koe..................    52        Managing Director
Christine A. Reich.............    36        Managing Director
Mark S. Zeidman................    46        Senior Vice President
                                             and Chief Financial Officer
</TABLE>

 
- ------------------
      (1) As of March 15, 1998.
 
     The background for the last five years of each executive officer of the
Company who is not a director, as well as certain other information, is set
forth below.
 
     John R. Barnes.  Mr. Barnes has served as Senior Vice President of the
Company and the Bank since May 1994 and served as Vice President of the same
from October 1989 to May 1994. Mr. Barnes was a Tax Partner in the firm of
Deloitte Haskins & Sells from 1986 to 1989 and in the firm of Arthur Young & Co.
from 1979 to 1986. Mr. Barnes was the Partner in Charge of the Cleveland Office
Tax Department of Arthur Young & Co. from 1979 to 1984. Mr. Barnes also has
served since May 1997 as Senior Vice President of OAIC and serves as an officer
and/or a director of many subsidiaries of the Company and OAIC.
 
     Joseph A. Dlutowski.  Mr. Dlutowski has served as Senior Vice President of
the Company and the Bank since March 1997. Mr. Dlutowski also has served since
May 1997 as Senior Vice President of OAIC and serves as an officer and/or a
director of many subsidiaries of the Company and OAIC. Mr. Dlutowski joined the
Bank in October 1992 and served as a Vice President from May 1993 until March
1997. From 1989 to 1991, Mr. Dlutowski was associated with the law firm of Baker
and Hostetler.
 
     John R. Erbey.  Mr. Erbey has served as a Managing Director of the Company
since January 1993 and as Secretary of the Company since June 1989, and served
as Senior Vice President of the Company from June 1989 until January 1993. Mr.
Erbey has served as a director of the Bank since 1990, as a Managing Director of
the Bank since May 1993 and as Secretary of the Bank since July 1989. Mr. Erbey
also has served since May 1997 as Managing Director and Secretary of OAIC and
serves as an officer and/or a director of many subsidiaries of the Company and
OAIC. Previously, Mr. Erbey served as Senior Vice President of the Bank from
June 1989 until May 1993. From 1971 to 1989, Mr. Erbey was a member of the Law
Department of Westinghouse Electric Corporation ("Westinghouse") and held
various management positions, including Associate General Counsel and Assistant
Secretary from 1984 to 1989. Previously, he held the positions of Assistant
General Counsel of the Industries and International Group and Assistant General
Counsel of the Power Systems Group of Westinghouse.
 
                                       5

<PAGE>
     Robert E. Koe.  Mr. Koe has served as a Managing Director of the Company
and the Bank since July 1, 1996. Mr. Koe also serves as an officer and/or a
director of many subsidiaries of the Company and OAIC. Mr. Koe has served as a
director of the Bank since 1994. Mr. Koe formerly was Chairman, President and
Chief Executive Officer of United States Leather, Inc. ("USL"), which includes
Pfister & Vogel Leather, Lackawanna Leather, A.L. Gebhardt and Caldwell/Moser
Leather. Prior to joining USL in 1990, he was Vice Chairman of Heller Financial
Inc., and served as a member of the board of its parent company, Heller
International Corp. ("Heller"), as well as Heller Overseas Corp. Mr. Koe moved
to Heller in 1984 from General Electric Capital Corp. ("GECC"), where he held
positions which included Vice President and General Manager of Commercial
Financial Services, Vice President and General Manager of Commercial Equipment
Financing, and President of Acquisition Funding Corp. Before joining GECC, Mr.
Koe held various responsibilities with its parent, General Electric Company,
from 1967 to 1975.
 
     Christine A. Reich.  Ms. Reich has served as a Managing Director of the
Company since June 1994. Ms. Reich also has served since May 1997 as a director
and President of OAIC and serves as an officer and/or a director of many
subsidiaries of the Company and OAIC. Ms. Reich served as Chief Financial
Officer of the Company from January 1990 to May 1997, as Senior Vice President
of the Company from January 1993 until June 1994 and as Vice President of the
Company from January 1990 until January 1993. Ms. Reich has served as a director
of the Bank since 1993 and as a Managing Director of the Bank since June 1994,
and served as Chief Financial Officer of the Bank from May 1990 to May 1997. Ms.
Reich served as Senior Vice President of the Bank from May 1993 to June 1994 and
Vice President of the Bank from January 1990 to May 1993. From 1987 to 1990, Ms.
Reich served as an officer of another subsidiary of the Company. Prior to 1987,
Ms. Reich was employed by KPMG Peat Marwick LLP, most recently in the position
of Manager.
 
     Mark S. Zeidman.  Mr. Zeidman has served as Senior Vice President and Chief
Financial Officer of the Company and the Bank since May 1997. Mr. Zeidman also
has served since June 1997 as Senior Vice President and Chief Financial Officer
of OAIC and serves as an officer of many subsidiaries of the Company and OAIC.
From 1986 until May 1997, Mr. Zeidman was employed by Nomura Securities
International, Inc., most recently as Managing Director. Prior to 1986, Mr.
Zeidman held positions with Shearson Lehman Brothers and Coopers & Lybrand. Mr.
Zeidman is a Certified Public Accountant.
 
                                       6

<PAGE>
                         SECURITY OWNERSHIP OF CERTAIN
                               BENEFICIAL OWNERS
 

BENEFICIAL OWNERSHIP OF COMMON STOCK
 
     The following table sets forth certain information regarding the beneficial
ownership of the Common Stock as of the date indicated by: (i) each director and
named executive officer of the Company and (ii) all directors and executive
officers of the Company as a group. The table is based upon information supplied
to the Company by its directors and executive officers. The address for each of
the individuals named below is the same as that of the Company.
 
     Other than as set forth in the following table, as of the date of this
Proxy Statement, there was no person or entity, including any "group" as that
term is used in Section 13(d)(3) of the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), who or which were known by the Company to be the
beneficial owner of 5% or more of the outstanding Common Stock.
 

<TABLE>
<CAPTION>
 
                                                      SHARES BENEFICIALLY OWNED AS
                                                             OF MARCH 15, 1998
                                                       -----------------------------
NAME OF BENEFICIAL OWNER                                AMOUNT(1)           PERCENT
- ------------------------                               ------------         --------
<S>                                                    <C>                  <C>
William C. Erbey.....................................   19,341,270 (2)        31.6%
Barry N. Wish........................................    9,372,249 (3)        15.3%
Hon. Thomas F. Lewis.................................        1,070 (4)           *
W.C. Martin..........................................        5,806 (5)           *
Howard H. Simon......................................        2,406 (6)           *
Joseph A. Dlutowski..................................       46,830 (7)           *
John R. Erbey........................................    2,088,408 (8)         3.4%
Robert E. Koe........................................      143,858 (9)           *
Christine A. Reich...................................      445,302(10)           *
All directors and executive officers as a group (11
  persons)...........................................   31,646,251(11)        51.8%
</TABLE>

 
- ------------------
     * Less than 1%.
 
 (1) For purposes of this table, pursuant to rules promulgated under the
     Exchange Act, an individual is considered to beneficially own any shares of
     Common Stock if he or she directly or indirectly has or shares: (i) voting
     power, which includes the power to vote or to direct the voting of the
     shares, or (ii) investment power, which includes the power to dispose or
     direct the disposition of the shares. Unless otherwise indicated an
     individual has sole voting power and sole investment power with respect to
     the indicated shares.
 
 (2) Includes 13,697,580 shares held by FF Plaza Partners, a Delaware
     partnership whose partners are William C. Erbey, his spouse, E. Elaine
     Erbey, and Delaware Permanent Corporation, a corporation wholly owned by
     William C. Erbey. Mr. and Mrs. William C. Erbey share voting and
     dispositive power with respect to the shares owned by FF Plaza Partners.
     Also includes 5,409,704 shares held by Erbey Holding Corporation, a
     corporation wholly owned by William C. Erbey. Also includes 2,406 shares
     held pursuant to the Directors Stock Plan and options to acquire 231,580
     shares which were exercisable at or within 60 days of March 15, 1998.
 
 (3) Includes 8,878,305 shares held by Wishco, Inc., a corporation controlled by
     Barry N. Wish pursuant to his ownership of 93.0% of the common stock
     thereof; 351,940 shares held by B.N.W. Partners, a Delaware partnership of
     which the partners are Mr. Wish and B.N.W., Inc., a corporation wholly
     owned by Mr. Wish; and 140,000 shares held by the Barry Wish Family
     Foundation, Inc., a charitable foundation of which Mr. Wish is a director.
     Also includes 2,004 shares held pursuant to the Directors Stock Plan.
 
 (4) Includes 400 shares held jointly with spouse. Also includes 670 shares held
     pursuant to the Directors Stock Plan.
 
                                       7

<PAGE>
 (5) Includes 3,400 shares held for the benefit of Mr. Martin by the Martin &
     Associates Management Consultants, Inc. Defined Contribution Pension Plan &
     Trust. Also includes 2,406 shares held pursuant to the Directors Stock
     Plan.
 
 (6) Consists of shares held pursuant to the Directors Stock Plan.
 
 (7) Includes 25,960 shares held jointly with spouse. Also includes options to
     acquire 20,870 shares of Common Stock which were exercisable at or within
     60 days of March 15, 1998.
 
 (8) Includes 1,807,330 shares held by John R. Erbey Family Limited Partnership,
     a Georgia limited partnership whose general partner is a corporation wholly
     owned by John R. Erbey and whose limited partners consist of John R. Erbey,
     his spouse and children. Also includes options to acquire 267,948 shares of
     Common Stock which were exercisable at or within 60 days of March 15, 1998.
 
 (9) Includes 40,350 shares held by Mr. Koe's spouse. Also includes options to
     acquire 63,158 shares of Common Stock which were exercisable at or within
     60 days of March 15, 1998. Does not include 10,100 shares held by Mr. Koe's
     son and daughter.
 
(10) Includes 445,300 shares held by CPR Family Limited Partnership, a Georgia
     limited partnership whose general partner is a corporation wholly owned by
     Christine A. Reich and whose limited partners are Christine A. Reich and
     her spouse.
 
(11) Includes options to acquire an aggregate of 605,856 shares of Common Stock
     which were exercisable at or within 60 days of March 15, 1998.
 

SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
 
     Section 16(a) of the Exchange Act requires the Company's executive officers
and directors, and persons who own more than 10% of the Common Stock, to file
reports of ownership and changes in ownership with the Securities and Exchange
Commission (the "SEC"). Officers, directors and greater than 10% shareholders
are required by SEC regulations to furnish the Company with copies of all
Section 16(a) forms they file. To the Company's knowledge, based solely upon
review of the copies of such reports furnished to the Company and written
representations that no other reports were required, the Company's officers,
directors and greater than 10% shareholders complied with all Section 16(a)
filing requirements applicable to them, except that Mr. Lewis inadvertently
failed to file a Form 4 in a timely manner to report an acquisition of shares on
October 30, 1997. Mr. Lewis made the required filing promptly after becoming
aware of this, and the transaction did not give rise to any liability under
Section 16(b) of the Exchange Act.
 
                                       8

<PAGE>
 
                            EXECUTIVE COMPENSATION
 
SUMMARY COMPENSATION TABLE
 
     The following table discloses compensation received by the Company's chief
executive officer and the four other most highly paid executive officers of the
Company for the years indicated.
 

<TABLE>
<CAPTION>
                                         ANNUAL COMPENSATION                LONG-TERM COMPENSATION AWARDS
                                    ------------------------------   --------------------------------------------
                                                                                     NO. OF
                                                                     RESTRICTED    SECURITIES
                                                                       STOCK       UNDERLYING        ALL OTHER
NAME AND POSITION                   YEAR   SALARY($)   BONUS($)(1)     AWARDS     OPTIONS(#)(2)   COMPENSATION($)
- -----------------                   ----   ---------   -----------   ----------   -------------   ---------------
<S>                                 <C>    <C>         <C>           <C>          <C>             <C>
William C. Erbey..................  1997   $150,000    $1,300,000        --          235,756(3)       $3,000(4)
  Chairman of the Board and Chief   1996    150,000       650,000        --          115,790           3,000(4)
    Executive Officer               1995    150,000            --        --          231,580           3,000(4)
John R. Erbey.....................  1997    150,000       925,000        --          162,083(3)        3,000(4)
  Managing Director and Secretary   1996    150,000       525,000        --          178,948           3,000(4)
                                    1995    150,000        50,000        --           89,000           3,000(4)
Robert E. Koe.....................  1997    150,000       350,000        --           49,116(3)        6,731(5)
  Managing Director                 1996     75,000(6)    250,000(6)     --           63,158           7,973(6)
Christine A. Reich................  1997    150,000       850,000        --          147,348(3)        3,000(4)
  Managing Director                 1996    150,000       487,500        --          163,158           3,000(4)
                                    1995    150,000        50,000        --           89,000           3,000(4)
Joseph A. Dlutowski...............  1997    120,673       300,000        --           39,293(3)        3,000(4)
  Senior Vice President
</TABLE>

 
- ------------------
 
(1) The indicated bonuses were paid pursuant to the Company's Annual Incentive
    Plan in the first quarter of the following year for services rendered in the
    year indicated.
 
(2) Consists of options granted pursuant to the Company's 1991 Non-Qualified
    Stock Option Plan, as amended.
 
(3) The indicated grants were made in January 1998 for services rendered in
    1997.
 
(4) Consists of contributions by the Company pursuant to the Company's 401(k)
    Savings Plan.
 
(5) Consists of contributions by the Company pursuant to the Company's 401(k)
    Savings Plan and $3,731 of relocation expenses in 1997.
 
(6) The indicated compensation amounts are applicable to the period of July 1,
    1996 through December 31, 1996, the period during which Mr. Koe served as a
    Managing Director. Mr. Koe received other compensation of $7,943 related to
    reimbursement of relocation expenses as well as $7,000 in director fees
    related to the period from January 1, 1996 through June 30, 1996, during
    which Mr. Koe served as a director of the Bank but not as an employee of the
    Company.
 
                                       9

<PAGE>
OPTION GRANTS FOR 1997
 
     The following table provides information relating to option grants made
pursuant to the 1991 Non-Qualified Stock Option Plan (the "Stock Option Plan")
in January 1998 to the individuals named in the Summary Compensation Table for
services rendered in 1997.
 
                     OPTION/SAR GRANTS IN LAST FISCAL YEAR
 

<TABLE>
<CAPTION>
                                       PERCENT OF
                                       SECURITIES              MARKET VALUE
                            NO. OF     UNDERLYING              PER SHARE OF
                          SECURITIES     TOTAL                   COMPANY                   POTENTIAL REALIZABLE VALUE AT ASSUMED
                          UNDERLYING    OPTIONS                   COMMON                   RATES OF STOCK PRICE APPRECIATION FOR
                           OPTIONS     GRANTED TO   EXERCISE     STOCK AT                            OPTION TERM($)(3)
                           GRANTED     EMPLOYEES     PRICE     DECEMBER 31,   EXPIRATION   -------------------------------------
NAME                      (#)(1)(2)      (%)(2)      ($/SH)      1997($)         DATE          0%           5%           10%
- ----                      ----------   ----------   --------   ------------   ----------   ----------   ----------   -----------
<S>                       <C>          <C>          <C>        <C>            <C>          <C>          <C>          <C>
William C. Erbey........   235,756        21.8       20.35       25.4375       1/31/08     1,199,409    4,972,094    10,757,546
John R. Erbey...........   162,083        15.0       20.35       25.4375       1/31/08       824,597    3,418,330     7,395,847
Robert E. Koe...........    49,116         4.5       20.35       25.4375       1/31/08       249,878    1,035,856     2,241,163
Christine A. Reich......   147,348        13.6       20.35       25.4375       1/31/08       749,633    3,107,569     6,723,489
Joseph A. Dlutowski.....    39,293         3.6       20.35       25.4375       1/31/08       199,903      828,689     1,792,940
</TABLE>

 
- ------------------
 
(1) All options are to purchase shares of Common Stock and vest and become
    exercisable in January 1999.
 
(2) Indicated grants were made in January 1998 for services rendered in 1997.
    The percentage of securities underlying these options to the total number of
    securities underlying all options granted to employees of the Company is
    based on options to purchase a total of 1,083,794 shares of Common Stock
    granted to employees of the Company under the Stock Option Plan in January
    1998.
 
(3) Assumes future prices of shares of Common Stock of $25.4375, $41.44 and
    $65.98 at compounded rates of return of 0%, 5% and 10%, respectively.
 
AGGREGATED OPTION EXERCISES IN 1997 AND YEAR-END OPTION VALUES
 
     The following table provides information relating to option exercises in
1997 by the individuals named in the Summary Compensation Table and the value of
each such individual's unexercised options at December 31, 1997.
 

<TABLE>
<CAPTION>
                                                                         NUMBER OF SECURITIES
                                                                        UNDERLYING UNEXERCISED         VALUE OF UNEXERCISED
                                           NUMBER OF                          OPTIONS AT              IN-THE-MONEY OPTIONS AT
                                            SHARES                      DECEMBER 31, 1997(#)(1)       DECEMBER 31, 1997($)(2)
                                          ACQUIRED ON      VALUE      ---------------------------   ---------------------------
NAME                                      EXERCISE(#)   REALIZED($)   EXERCISABLE   UNEXERCISABLE   EXERCISABLE   UNEXERCISABLE
- ----                                      -----------   -----------   -----------   -------------   -----------   -------------
<S>                                       <C>           <C>           <C>           <C>             <C>           <C>
William C. Erbey........................        --              --      231,580        235,756       3,343,436      1,199,409
John R. Erbey...........................        --              --      267,948        162,083       4,591,179        824,597
Robert E. Koe...........................        --              --       63,158         49,116         911,844        249,878
Christine A. Reich......................    89,000       2,146,680      163,158        147,348       2,355,598        749,633
Joseph A. Dlutowski.....................        --              --       20,870         39,293         354,793        199,903
</TABLE>

 
- ------------------
 
(1) All options are to purchase shares of Common Stock and were granted pursuant
    to the Stock Option Plan. Options listed as "exercisable" consist of options
    granted in January 1997 which became exercisable in January 1998. Options
    listed as "unexercisable" consist of options granted in January 1998 which
    become exercisable in January 1999.
 
(2) Based on the $25.4375 closing price of a share of Common Stock on the NYSE
    on December 31, 1997.
 
C
OMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
 
     Determinations regarding compensation of the Company's officers are made by
the Company's Nominating and Compensation Committee. The members of the
Committee during the fiscal year ended December 31, 1997 were Directors Martin
(Chairman), Lewis and Simon. See "Certain Relationships and Related
Transactions."
 
                                       10

<PAGE>
REPORT OF THE NOMINATING AND COMPENSATION COMMITTEE
 
     The Nominating and Compensation Committee (the "Committee") of the Board of
Directors is responsible for establishing management compensation policies and
procedures to be reflected in the compensation program offered to the executive
officers of the Company and the Bank. The Committee shares jurisdiction with the
full Board of Directors over the administration of and grants under the Stock
Option Plan.
 
     The members of the Committee and the members of the Nominating and
Compensation Committee of the Bank are identical. No member of the Committee is
an employee of the Company or any subsidiary.
 
     General Compensation Policies.  The broad general salary and benefit
guidelines are determined by the Committee.
 
     With respect to the Company's officers other than Mr. William C. Erbey, the
Committee considered salary and bonus recommendations prepared by Mr. William C.
Erbey or other executive officers to determine fiscal 1997 compensation. The
salary adjustment recommendations were based on the Company's overall
performance in the past year and an analysis of compensation levels necessary to
maintain and attract quality personnel. It is through this process that the
Company is able to compete for and retain talented executives who are critical
to the Company's long-term success and to align the interests of those
executives with the long-term interests of the Company's shareholders.
 
     In general, the Committee has sought to design a compensation package in
which a significant portion of the compensation paid to senior management
(including the named executive officers) be performance-based because those
individuals have more control and influence over the direction and performance
of the Company and the Bank. Integration of all decisions regarding stock
options and/or grants ensures the Committee that the compensation package is
reviewed in its entirety on an annual basis.
 
     Executive Compensation.  The compensation package offered to the executive
officers of the Company and the Bank in 1997 reflects the Committee's attempt to
balance salary and stock options, as well as benefits available under the
various employee plans.
 
     The Committee is satisfied with the present process used to determine base
salary. However, in addition to base salary, the Committee seeks to provide a
substantial portion of each executive officer's total compensation through
incentive plans which provide awards based on or tied to the performance of the
Company and the Bank. Historically, the Committee has reviewed an analysis of
the Company's return on average equity as compared to a group of four large bank
holding companies and four investment banks. It is in the sole discretion of the
Committee as to the interpretation of such performance measure and its
translation into short-term awards.
 
     Stock option grants with deferred vesting currently provide the basis for a
long-term incentive program. The objective of these options is to create a
direct link between executive compensation and long-term Company performance. In
determining the appropriate level of stock-based allotments, the Committee
considers the executive's contribution toward Company and Bank performance. To
encourage growth in shareholder value, stock options are granted to key
management personnel who are in a position and have the responsibility to make a
substantial contribution to the long-term success of the Company. The Committee
believes this focuses attention on managing the Company from the perspective of
an owner with an equity stake in the business.
 
     The Committee's policy with respect to other employee benefit plans is to
provide competitive benefits to employees of the Company and the Bank, including
executive officers. A competitive comprehensive benefit program is essential to
achieving the goal of attracting and retaining highly-qualified employees.
 
     Under Section 162(m) of the Internal Revenue Code of 1986, as amended (the
"Code"), the tax deduction by corporate taxpayers is limited with respect to the
compensation of certain executive officers above $1 million per covered
executive unless such compensation is based upon performance
 
                                       11

<PAGE>
objectives meeting certain regulatory criteria or is otherwise excluded from the
limitation. Due to transition provisions included in this Code section, it is
expected that all payments under the Company's annual incentive plan for periods
prior to 1998, as well as all payments under the Stock Option Plan, will be
fully deductible by the Company for federal income tax purposes and will not be
subject to the limitations set forth in Section 162(m) of the Code.
 
     Chief Executive Officer Compensation.  In determining the overall
compensation package for the Chief Executive Officer, the Committee considered
each of the factors enumerated in the preceding paragraphs regarding
compensation for executive officers of the Company as well as the financial
performance achieved by the Company during the past fiscal year. In addition to
a high level of earnings, the Company continued at or near the top of the
financial industry for such key financial performance measures as return on
average assets, return on average equity, capital and efficiency ratios.
 
     Proposed New Plans.  As discussed in greater detail elsewhere in this Proxy
Statement, the Board, as part of an overall review of Company compensation
practices, has decided to replace its former annual incentive plan with the 1998
Annual Incentive Plan and to adopt the Long-Term Incentive Plan. The new plans
are intended to further enhance the incentive which manangement has to grow the
value of the Company for shareholders over the long term. If approved by the
shareholders, the Board and the Committee will implement such plans during the
1998 fiscal year.
 
                                                               Nominating and
Compensation Committee:
 
                                                                  W.C. Martin,
                                                                  Chairman
                                                                  Hon. Thomas F.
                                                                  Lewis,
                                                                  Director
                                                                  Howard H.
                                                                  Simon,
                                                                  Director
 
March 15, 1998
 
                                       12

<PAGE>

                 CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
 
     At December 31, 1997, the Company held a residential mortgage loan with an
interest rate of 8.5% which was made by an institution acquired by the Bank to
Howard H. Simon, a director of the Company. The principal balance of this loan
amounted to $99,131 at December 31, 1997, and the highest principal balance of
this loan during 1997 was $115,093.
 
     In September 1996, the Company loaned $6.7 million to certain of its and
the Bank's current and former officers and directors to fund their exercise of
vested stock options to purchase an aggregate of 5,427,320 shares of Common
Stock, including 1,849,280 shares, 351,940 shares, 1,495,760 shares, 445,300
shares and 166,500 shares acquired by William C. Erbey, Barry N. Wish, John R.
Erbey, Christine A. Reich and John R. Barnes, respectively, who issued notes to
the Company in the amount of $2.2 million, $423,000, $1.8 million, $583,000 and
$263,000, respectively. Such notes had an interest rate of 10.5% per annum, were
payable in two equal installments on March 1, 1998 and March 1, 1999 and were
secured by the related shares of Common Stock. At the time of the issuance of
the foregoing notes, the Company also agreed to loan the makers thereof up to an
additional $1.7 million to fund the payment of additional taxes owed in
connection with the exercise of the above-referenced stock options, including
$594,000, $478,000 and $134,000 in the case of William C. Erbey, John R. Erbey
and Christine A. Reich, respectively. Notes in these amounts were issued by
these persons in April 1997 with the same terms as the above-referenced notes.
As of December 31, 1997, all of the above-referenced notes had been repaid.
 
     On January 20, 1998, the Company purchased indirectly from William C.
Erbey, Chairman, President and Chief Executive Officer of the Company, and Barry
N. Wish, a director of the Company, 159,156 shares and 159,155 shares of Common
Stock, respectively, which equaled the aggregate number of shares of Common
Stock issued by the Company on the same date in connection with its acquisition
of DTS Communications, Inc. ("DTS"), a company engaged in the business of
electronic data interchange for the real estate and mortgage-related industries.
The per share price of the shares of Common Stock purchased from Messrs. Erbey
and Wish was $24.42, which was equal to the average per share price of the
Common Stock determined pursuant to the Agreement of Merger, dated as of January
7, 1998, among the Company, DTS and certain other parties for the purpose of
determining the number of shares of Common Stock to be issued by the Company in
connection with the acquisition of DTS (which price was equal to the average of
the high and low per share sales price of the Common Stock on the NYSE during
each of the 20 trading days ending three trading days prior to consummation of
the acquisition of DTS).
 
     William C. Erbey is Chairman of the Board and Chief Executive Officer of
Ocwen Asset Investment Corp., a publicly held real estate investment trust
("OAIC") managed by Ocwen Capital Corporation, a wholly owned subsidiary of the
Company ("OCC"). Under the terms of the management agreement by and between OAIC
and OCC, OAIC paid $1,787,981 in management fees to OCC for the year ended
December 31, 1997. In addition, for the year ended December 31, 1997, OAIC
reimbursed OCC in the amount of $648,088 for out-of-pocket costs and salary
allocation for due diligence tasks performed by OCC employees on behalf of OAIC.
 
                                       13

<PAGE>
 
                              PERFORMANCE GRAPH
 
     The following graph compares the cumulative total return on the Common
Stock of the Company since the initial public offering of the Common Stock by
certain shareholders of the Company in September 1996 with the cumulative total
return on the stocks included in: (i) the Standard & Poor's 500 Market Index;
(ii) the Nasdaq Stock Market (United States); and (iii) the Standard & Poor's
Financial (Diversified) 500 Market Index.
 
     The above graph represents $100 invested in Common Stock on September 25,
1996 at the closing price of $20.25 per share on that date, and in each index on
such date. The Common Stock was quoted on the Nasdaq Stock Market's National
Market System from September 25, 1996 through July 31, 1997 and has been listed
on the NYSE since August 1, 1997. There was no established market for the Common
Stock prior to September 25, 1996.
 
                PROPOSAL TO ADOPT THE 1998 ANNUAL INCENTIVE PLAN

                                 (PROPOSAL TWO)
 
     The Board of Directors of the Company has approved, subject to shareholder
approval, the Ocwen Financial Corporation 1998 Annual Incentive Plan (the "1998
Annual Incentive Plan") to replace the Company's former annual incentive plan.
The 1998 Annual Incentive Plan is being submitted for shareholder approval in
order to qualify compensation under the 1998 Annual Incentive Plan as
performance-based compensation for purposes of Section 162(m) of the Internal
Revenue Code of 1986, as amended (the "Code").
 
                                       14

<PAGE>
     The purpose of the 1998 Annual Incentive Plan is to advance the success of
the Company and to thereby increase shareholder value by promoting the
attainment of significant business objectives by the Company and its business
units by basing a portion of the annual compensation of selected officers and
key employees on the attainment of such objectives.
 
SUMMARY OF THE ANNUAL INCENTIVE PLAN
 
     The following summary of the 1998 Annual Incentive Plan is qualified in its
entirety by reference to the complete text of the 1998 Annual Incentive Plan, a
copy of which is attached as Exhibit A to this Proxy Statement.
 
     TERM.  The effective date of the 1998 Annual Incentive Plan is March 24,
1998, subject to approval of the 1998 Annual Incentive Plan by the shareholders
of the Company. The 1998 Annual Incentive Plan does not have a fixed expiration
date.
 
     ADMINISTRATION.  The 1998 Annual Incentive Plan will be administered by the
Nominating and Compensation Committee of the Company's Board of Directors or, in
certain events, by the full Board of Directors (the "Annual Incentive Plan
Committee"). The Annual Incentive Plan Committee has sole and complete authority
to make awards under the 1998 Annual Incentive Plan, to determine the terms and
conditions of such awards and to interpret and make all other determinations
affecting the 1998 Annual Incentive Plan. The Annual Incentive Plan Committee
may, with respect to participants in the 1998 Annual Incentive Plan (each an
"AIP Participant") who are not subject to Section 16 of the Exchange Act and
Section 162(m), delegate such of its powers and authority under the 1998 Annual
Incentive Plan to the Company's Chairman, President or Chief Executive Officer
as it deems appropriate.
 
     PARTICIPATION.  Participation in the 1998 Annual Incentive Plan is limited
to officers and other key employees of the Company and designated subsidiaries
who are selected from time to time by the Annual Incentive Plan Committee.
Participation in the 1998 Annual Incentive Plan does not preclude participation
in any other employee benefit plans of the Company and does not create any
rights to continued employment with the Company.
 
     PERFORMANCE TARGETS AND SECTION 162(M).  The Annual Incentive Plan
Committee will designate performance targets under the 1998 Annual Incentive
Plan for each year. The performance targets will be based on achievement of
specified levels of increases in net earnings, return on equity, average net
equity used or growth in assets for a specified period, typically a fiscal year.
 
     Section 162(m) of the Code provides in general that compensation in excess
of $1.0 million per year paid to the chief executive officer and the four other
most highly compensated officers of a public company is not deductible by the
corporation; provided, that certain performance-based compensation may be
excluded from this deductibility limitation if, among other things, (i) the
compensation is paid solely on account of the attainment of one or more
performance goals, (ii) the performance goals are established by a compensation
committee consisting solely of two or more outside directors, (iii) the material
terms under which the compensation is to be paid, including the performance
goals, are disclosed to and approved by the shareholders prior to payment, and
(iv) prior to payment, the compensation committee certifies that the performance
goals were in fact satisifed. Approval of the 1998 Annual Incentive Plan by the
shareholders of the Company will constitute approval of the 1998 Annual
Incentive Plan, including approval of the performance objectives, for purposes
of Section 162(m). It is the current intention of the Board of Directors that
all otherwise tax deductible compensation payable under the 1998 Annual
Incentive Plan be excludable from the limitation on deductibility imposed by
Section 162(m).
 
     MAXIMUM ANNUAL AWARDS.  The maximum bonus amount payable under the 1998
Annual Incentive Plan to any AIP Participant shall not exceed $2,000,000 for any
year. If the Company's performance meets or exceeds the highest target levels
for 1998 and if the Annual Incentive Plan Committee does not eliminate or reduce
awards for 1998 (see "Reduction or Termination of Payment"
 
                                       15

<PAGE>
below), the maximum awards payable to the Company's executive officers under the
1998 Annual Incentive Plan for 1998 would be as follows:
 

<TABLE>
<CAPTION>
                                                            MAXIMUM 1998 ANNUAL
NAME AND PRINCIPAL POSITION                                 INCENTIVE PLAN AWARD
- ---------------------------                                 --------------------
<S>                                                         <C>
William C. Erbey, Chairman, President
  and Chief Executive Officer.............................       $1,213,650
John R. Erbey, Managing Director, Secretary
  and General Counsel.....................................       $1,011,375
Christine A. Reich, Managing Director.....................       $1,011,375
Joseph A. Dlutowski, Senior Vice President................       $  450,000
Executive Officers as a Group (seven persons).............       $4,482,400
                                                                 ==========
</TABLE>

 
     As of the date of this proxy statement, the maximum awards payable under
the 1998 Annual Incentive Plan to non-executive officers of the Company as a
group have not been determined.
 
     The maximum bonus amounts set forth above represent only the maximum bonus
awards under the 1998 Annual Incentive Plan. Additional discretionary bonuses
may be awarded by the Company outside of the 1998 Annual Incentive Plan. Any
such discretionary amounts would be subject to the $1,000,000 deductibility
limit under Section 162(m) of the Code. The Company currently expects that all
or a substantial majority of such compensation will fall within the
deductibility limits (assuming shareholder approval of the 1998 Annual Incentive
Plan and, therefore, be fully deductible). It is possible, however, that a
portion of the compensation paid to an executive officer of the Company may not
be deductible under the Code.
 
     CERTIFICATION OF ACHIEVEMENT OF PERFORMANCE STANDARDS.  The 1998 Annual
Incentive Plan Committee shall, prior to any payment under the 1998 Annual
Incentive Plan, certify in writing the extent, if any, of achievement of
performance standards for each AIP Participant. For purposes of this provision,
the approved minutes of the Annual Incentive Plan Committee meeting in which the
certification is made may be treated as a written certification.
 
     REDUCTION OR TERMINATION OF PAYMENT.  The Annual Incentive Plan Committee
may, in its sole discretion, establish certain additional performance-based
conditions that must be satisfied by the Company, a business unit of the Company
or the AIP Participant as a condition precedent to the payment of all or a
portion of any awards. Such conditions precedent may include, among other
things, the receipt by an AIP Participant of a specified annual performance
rating and the achievement of specified performance goals by the Company,
business unit or AIP Participant.
 
     PAYMENT OF AWARDS.  Awards under the 1998 Annual Incentive Plan shall be
paid in cash, as soon as practicable after appropriate financial statements for
the performance period are available. The Annual Incentive Plan Committee may,
in it sole discretion, elect to pay all or a portion of the total award value in
the form of non-qualified stock options to purchase Common Stock, in lieu of
paying such amount in cash or require an AIP Participant to defer up to 25% of
any award otherwise payable to the AIP Participant.
 
     AMENDMENT OR TERMINATION.  The Board of Directors of the Company may
modify, amend or terminate the 1998 Annual Incentive Plan at any time, except
that no modification, amendment or termination may adversely affect the rights
of an AIP Participant under an award previously made to him without his consent.
 
     NO ASSIGNMENT.  Except as expressly authorized by the Annual Incentive Plan
Committee, the rights under the 1998 Annual Incentive Plan, including without
limitation the rights to receive any payment, shall not be sold, assigned,
transferred, encumbered or hypothecated by an AIP Participant (except by
testamentary disposition or intestate succession), and during the lifetime of
any AIP Participant any payment shall be payable only to such AIP Participant.
 
                                       16

<PAGE>
     GOVERNING LAW.  The validity, construction and effect of the 1998 Annual
Incentive Plan and any action taken or relating to the Annual Incentive Plan
shall be determined in accordance with the laws of the State of Florida and
applicable federal law.
 
FEDERAL INCOME TAX CONSEQUENCES
 
     Under present federal income tax regulations, AIP Participants will realize
ordinary income equal to the amount of the award received in the year of
receipt. The Company will receive a deduction for the amount constituting
ordinary income to the AIP Participant, provided that the 1998 Annual Incentive
Plan satisfies the requirements of Section 162(m) of the Code. It is the
Company's intention that the 1998 Annual Incentive Plan be constructed and
administered in a manner that ensures the deductibility of compensation for the
Company under Section 162(m) of the Code.
 
     The foregoing brief summary of the effect of federal income taxation upon
AIP Participants and the Company with respect to the 1998 Annual Incentive Plan
does not purport to be complete and reference should be made to the applicable
provisions of the Code. In addition, this summary does not discuss the
provisions of income tax laws of any municipality, state or foreign country in
which an AIP Participant may reside.
 
     Because executive officers of the Company (one of whom is a member of the
Board of Directors) are eligible to receive awards under the 1998 Annual
Incentive Plan, each of them has a personal interest in the adoption of the 1998
Annual Incentive Plan.
 
 
    THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE FOR
APPROVAL OF THE 1998 ANNUAL INCENTIVE PLAN.
 
                 PROPOSAL TO ADOPT THE LONG-TERM INCENTIVE PLAN

                                (PROPOSAL THREE)
 
     The Board of Directors of the Company has approved, subject to shareholder
approval, the Ocwen Financial Corporation Long-Term Incentive Plan (the
"Long-Term Incentive Plan"). Pursuant to the rules of the NYSE on which the
Company's Common Stock is traded, the Long-Term Incentive Plan is being
submitted to the holders of Common Stock of the Company for approval. The
Long-Term Incentive Plan is also being submitted for shareholder approval in
order to qualify compensation under the Long-Term Incentive Plan as
performance-based compensation for purposes of Section 162(m) of the Code.
 
     The purposes of the Long-Term Incentive Plan are to: (i) further align the
interests of officers and key employees with the interests of the Company's
shareholders; (ii) reward officers and key employees for creating shareholder
value as measured by objectively determinable performance goals; and (iii)
assist in the attraction and retention of employees vital to the Company's
long-term success.
 
SUMMARY OF THE LONG-TERM INCENTIVE PLAN
 
     The following summary of the Long-Term Incentive Plan is qualified in its
entirety by reference to the complete text of the Long-Term Incentive Plan, a
copy of which is attached as Exhibit B to this Proxy Statement.
 
     TERM.  The effective date of the Long-Term Incentive Plan is March 24,
1998, subject to approval of the Long-Term Incentive Plan by the shareholders of
the Company. The Long-Term Incentive Plan does not have a fixed expiration date.
 
                                       17

<PAGE>
     ADMINISTRATION.  The Long-Term Incentive Plan will be administered by the
Nominating and Compensation Committee of the Company's Board of Directors or, in
certain events, by the full Board of Directors (the "Long-Term Incentive Plan
Administrator"). The Long-Term Incentive Plan Administrator has sole and
complete authority to make awards under the Long-Term Incentive Plan, to
determine the terms and conditions of such awards, and to interpret and make all
other determinations affecting the Long-Term Incentive Plan. The Long-Term
Incentive Plan Administrator, may with respect to participants in the Long-Term
Incentive Plan (each a "LTIP Participant") who are not subject to Section 16 of
the Exchange Act and Section 162(m), delegate such of its powers and authority
under the Long-Term Incentive Plan to the Company's Chairman, President or Chief
Executive Officer as it deems appropriate.
 
     PARTICIPATION AND AWARD ESTIMATES.  Participation in the Long-Term
Incentive Plan is limited to officers and other key employees of the Company and
designated subsidiaries who are selected from time to time by the Long-Term
Incentive Plan Administrator. Participation in the Long-Term Incentive Plan does
not preclude participation in any other employee benefit plans of the Company
and does not create any rights to continued employment with the Company. Because
the grant of awards under the Long-Term Incentive Plan is at the discretion of
the Long-Term Incentive Plan Administrator, it is not possible to indicate at
this time which persons may receive awards under the Long-Term Incentive Plan or
the amount of such awards.
 
     BASIS POINT AWARDS.  The Long-Term Incentive Plan provides for the grant,
in the discretion of the Long-Term Incentive Plan Administrator after receiving
the recommendations of management of the Company, of Basis Points to LTIP
Participants. In connection with any such grant, the Long-Term Incentive Plan
Administrator will establish a performance period applicable to each award of
Basis Points and performance targets for such performance period. Within 90 days
after the end of the performance period, the Company will determine the value of
the Basis Points held by each LTIP Participant for such performance period based
on the extent to which the related performance targets are achieved. The Company
shall pay to each LTIP Participant the value of such LTIP Participant's Basis
Points in the form of shares of restricted Common Stock of the Company
("Restricted Stock") based on the Fair Market Value (as that term is defined in
the Long-Term Incentive Plan) of the Common Stock on the last day of the
performance period pursuant to which such payment is made.
 
     In the event of the termination of a LTIP Participant's employment with the
Company for any reason other than death, Disability or Retirement (as such terms
are defined in the Long-Term Incentive Plan) prior to the end of a performance
period, all Basis Points theretofore awarded to the LTIP Participant shall
terminate and the LTIP Participant will forfeit all rights to earn Restricted
Stock pursuant to such Basis Points.
 
     In the event of the termination of a Participant during a performance
period by reason of death, Disability or Retirement, the LTIP Participant will
retain all Basis Points theretofore awarded, and in the event that the
performance goals are satisfied, such LTIP Participant (or the LTIP
Participant's beneficiary) will be entitled to a prorated payment based upon the
number of months of the performance period that the LTIP Participant served as
an employee.
 
     RESTRICTED STOCK.  The Restricted Stock, if any, issued to a LTIP
Participant at the end of a performance period will vest over a ten year period.
Upon vesting, the certificates representing such shares will be held by the
Company in a nonqualified irrevocable trust established by the Company (the
"Deferred Compensation Trust") for the benefit of the LTIP Participant, and the
LTIP Participant will have all the rights of a shareholder, including the right
to vote, except that: (i) the LTIP Participant will not be entitled to receive a
certificate representing such shares and (ii) the shares may not be transferred,
sold, assigned, pledged or otherwise encumbered. Any cash dividends paid with
respect to the Restricted Stock will be reinvested to purchase additional shares
of Common Stock (which will be subject to the same restrictions that apply to
the Restricted Stock). Unvested Restricted Stock will be forfeited by the LTIP
Participant to the Company, and the LTIP Participant will have no further rights
thereto upon the termination of a LTIP Participant's employment with the Company
by reason other than death, Disability or Retirement. If the LTIP Participant
terminates employment with the Company by reason of death, Disability or
Retirement all unvested shares will be vested. Participants will be entitled to
receive certificates for the vested Common Stock credited to their account under
the Long-
 
                                       18

<PAGE>
Term Incentive Plan free and clear of all restrictions over a five year period
following the LTIP Participant's termination of employment with the Company or,
in the event that termination of the LTIP Participant was the result of death,
Disability or Retirement, over the five year period following the expiration of
the next performance period to expire under the Long-Term Incentive Plan. Common
Stock held in the Deferred Compensation Trust held for the LTIP Participant
shall be issued to participants in 20% increments in each year of the five year
pay-out period.
 
     In any case, the Long-Term Incentive Plan Administrator may, in its sole
discretion, permit a LTIP Participant to retain the Basis Points or Restricted
Stock that would otherwise be forfeited under the terms of the Long-Term
Incentive Plan.
 
     PERFORMANCE TARGETS AND SECTION 162(M).  The performance targets
established by the Long-Term Incentive Plan Administrator for any performance
period will be based upon one or more of earnings per share and/or return on
equity.
 
     Section 162(m) of the Code provides in general that compensation in excess
of $1.0 million per year paid to the chief executive officer and the four other
most highly compensated officers of a public company is not deductible by the
corporation; provided, that certain performance-based compensation may be
excluded from this deductibility limitation if, among other things, (i) the
compensation is paid solely on account of the attainment of one or more
performance goals, (ii) the performance goals are established by a compensation
committee consisting solely of two or more outside directors, (iii) the material
terms under which the compensation is to be paid, including the performance
goals, are disclosed to and approved by the shareholders prior to payment, and
(iv) prior to payment, the compensation committee certifies that the performance
goals were in fact satisfied. Approval of the Long-Term Incentive Plan by the
shareholders of the Company will constitute approval of the Long-Term Incentive
Plan, including approval of the performance objectives, for purposes of Section
162(m). It is the current intention of the Board of Directors that all otherwise
tax deductible compensation payable under the Long-Term Incentive Plan be
excludable from the limitation on deductibility imposed by Section 162(m).
 
     MAXIMUM ANNUAL AWARD.  The maximum value of Basis Points that may be earned
by any LTIP Participant under the Long-Term Incentive Plan for any Performance
Period is $25 million.
 
     ADJUSTMENTS.  The Long-Term Incentive Plan Administrator may, in its
discretion, at any time adjust the performance objectives applicable to any
Basis Points, adjust the manner in which such performance objectives are
measured, lengthen or shorten the performance period, or lengthen or shorten the
vesting period with respect to any Restricted Stock if it determines that
conditions so warrant and that such adjustment would not cause otherwise
deductible compensation under Section 162(m) to cease to qualify as
performance-based compensation. Further, the number of Basis Points and shares
of Restricted Stock shall be appropriately adjusted by the Long-Term Incentive
Plan Administrator for stock dividends, stock splits, recapitalizations, mergers
or other changes in the capitalization of the Company.
 
     CASH AWARDS.  The Long-Term Incentive Plan Administrator may, in its
discretion, from time to time, award Basis Points payable in cash.
 
     AMENDMENT AND TERMINATION.  The Board of Directors of the Company may
modify, amend or terminate the Long-Term Incentive Plan at any time except that
no modification, amendment or termination may adversely affect the rights of a
LTIP Participant under an award previously made to him without his consent.
 
FEDERAL INCOME TAX CONSEQUENCES
 
     There will be no federal income tax consequences to LTIP Participants or to
the Company upon the grant of Basis Points or upon the issuance of Restricted
Stock. LTIP Participants will recognize income for federal income tax purposes
in an amount equal to the fair market value of the shares received (determined
as of the date on which the shares become transferable or not subject to a
substantial risk of forfeiture, whichever occurs first) and the Company will be
entitled to a deduction in a like amount. The Long-Term Incentive Plan
Administrator may, in its sole discretion, permit a LTIP Participant to defer
the receipt of all or a portion of the Common Stock payable upon lapse of
 
                                       19

<PAGE>
applicable restrictions. Further, the Long-Term Incentive Plan Administrator may
permit a LTIP Participant to satisfy any income tax withholding obligation of
the Company with respect to any award under the Long-Term Incentive Plan by
withholding a portion of the shares of Common Stock otherwise payable to the
LTIP Participant or by delivering previously owned shares of Common Stock.
 
     The foregoing summary of the effect of federal income taxation upon LTIP
Participants and the Company with respect to the Long-Term Incentive Plan does
not purport to be complete and reference should be made to the applicable
provisions of the Code. In addition, this summary does not discuss the
provisions of income tax laws of any municipality, state or foreign country in
which a LTIP Participant may reside.
 
     Because executive officers of the Company (one of whom is a member of the
Board of Directors) are eligible to receive awards under the Long-Term Incentive
Plan, each of them has a personal interest in the adoption of the Long-Term
Incentive Plan.
 
 
    THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE FOR
APPROVAL OF THE LONG-TERM INCENTIVE PLAN.
 
               RATIFICATION OF APPOINTMENT OF INDEPENDENT AUDITOR

                                (PROPOSAL FOUR)
 
     The Board of Directors of the Company has appointed Price Waterhouse LLP,
independent certified public accountants, to be the Company's independent
auditor for the year ending December 31, 1998, and has further directed that the
selection of the auditor be submitted for ratification by the shareholders at
the Annual Meeting.
 
     Representatives of Price Waterhouse LLP will be present at the Annual
Meeting, will be given the opportunity to make a statement, if they so desire,
and will be available to respond to appropriate questions from shareholders.
 
 
    THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE FOR
RATIFICATION OF THE APPOINTMENT OF PRICE WATERHOUSE LLP AS THE INDEPENDENT
AUDITOR FOR 1998.
 
                     SHAREHOLDER PROPOSALS TO BE PRESENTED
                           AT THE NEXT ANNUAL MEETING
 
     Any proposal which a shareholder desires to have included in the proxy
materials of the Company relating to the next annual meeting of shareholders,
which is scheduled to be held in May 1999, must be received at the executive
offices of the Company, 1675 Palm Beach Lakes Boulevard, The Forum, West Palm
Beach, Florida 33401, Attention: Secretary, no later than December 1, 1998. If
such proposal is in compliance with all of the requirements of Rule 14a-8 under
the Exchange Act, it will be included in the Proxy Statement and set forth on
the form of proxy issued for the next annual meeting of shareholders. It is
urged that any shareholder proposals be sent by certified mail, return receipt
requested.
 
                                 ANNUAL REPORTS
 
     A copy of the Company's Annual Report to Shareholders for the year ended
December 31, 1997 is being mailed with this Proxy Statement to shareholders
entitled to notice of the Annual Meeting. Such report is not part of the proxy
solicitation materials.
 
     Upon receipt of a written request, the Company will furnish to any
shareholder a copy of the Company's Annual Report on Form 10-K for the year
ended December 31, 1997 required to be filed by the Company with the SEC under
the Exchange Act. Such requests should be directed to Investor Relations, Ocwen
Financial Corporation, 1675 Palm Beach Lakes Boulevard, The Forum, West Palm
Beach, Florida 33401, telephone (561) 682-8400. Such report is not part of the
proxy solicitation materials.
 
                                       20

<PAGE>
                                 OTHER MATTERS
 
     Management is not aware of any business to come before the Annual Meeting
other than the matters described above in this Proxy Statement. However, if any
other matters should properly come before the Annual Meeting, it is intended
that the Proxies solicited hereby will be voted with respect to those other
matters in accordance with the judgment of the person or persons appointed as
proxies.
 
     The cost of the solicitation of proxies will be borne by the Company. The
Company will reimburse brokerage firms and other custodians, nominees and
fiduciaries for reasonable expenses incurred by them in sending proxy materials
to the beneficial owners of the Common Stock. In addition to solicitations by
mail, directors, officers and employees of the Company may solicit proxies
personally or by telephone without additional compensation.
 
     Notwithstanding anything to the contrary set forth in any of the Company's
previous filings under the Securities Act of 1933, as amended, or the Exchange
Act, that might incorporate future filings, including this Proxy Statement, in
whole or in part, the Report of the Nominating and Compensation Committee and
the Performance Graph contained herein shall not be incorporated by reference
into any such filings.
 
                                       21

<PAGE>
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                                       22

<PAGE>
                                                                       EXHIBIT A
 
                          OCWEN FINANCIAL CORPORATION
                           1998 ANNUAL INCENTIVE PLAN
 
                        ARTICLE I -- GENERAL PROVISIONS
 
1.1  PURPOSE
 
      The purpose of the Ocwen Financial Corporation Annual Incentive Plan (the
"Plan") is to advance the success of Ocwen Financial Corporation and to thereby
increase shareholder value by promoting the attainment of significant business
objectives by the Company or a business unit and basing a portion of the annual
compensation of selected officers and key employees on the attainment of such
objectives. The Plan is designed to: (i) further align the interests of
Participants with the interests of the Company's shareholders, (ii) reward
Participants for creating shareholder value as measured by objectively
determinable performance goals and (iii) assist in the attraction and retention
of employees vital to the Company's long-term success.
 
1.2  DEFINITIONS
 
      For the purpose of the Plan, the following terms shall have the meanings
indicated:
 

<TABLE>
<S>       <C>
(a)       "Board" means the Board of Directors of the Company.
(b)       "Cause" means: (i) conduct, activities or performance by a
          Participant which, in the judgment of the Company, based
          upon the information then in its possession, is detrimental
          to its interests, business, goodwill or reputation; or (ii)
          such definition of Cause as is contained in a Participant's
          employment agreement, if any, with the Company.
(c)       "Code" means the Internal Revenue Code of 1986, as amended,
          including any successor law thereto.
(d)       "Company" means Ocwen Financial Corporation and, solely for
          purposes of determining (i) eligibility for participation in
          the Plan, (ii) employment and (iii) the calculation of any
          performance goal, shall include any corporation,
          partnership, or other organization of which the Company owns
          or controls, directly or indirectly, not less than 50
          percent of the total combined voting power of all classes of
          stock or other equity interests. For purposes of this Plan,
          the term "Company" shall include any successor to Ocwen
          Financial Corporation.
(e)       "Committee" means the Nominating and Compensation Committee
          of the Board (or any successor committee of the Board
          performing a similar function or the whole Board if the
          Board performs such functions) or, with respect to any
          particular function under the Plan identified by the
          Committee or the Board, any subcommittee of the whole
          Committee established by the whole Committee or the Board in
          order to comply with the definition of Non-Employee Director
          under Rule 16b-3 of the Exchange Act and the definition of
          outside director under Section 162(m) of the Code.
(f)       "Common Stock" means the Company's Common Stock, par value
          $.01 per share.
(g)       "Exchange Act" means the Securities Exchange Act of 1934, as
          amended.
(h)       "Participant" means any person who has satisfied the
          eligibility requirements set forth in Section 1.4 and to
          whom an award has been made under the Plan.
(i)       "Performance Measures" means the criteria upon which awards
          will be based and, unless otherwise determined by the
          Committee, shall be any one or more of the following
          measures: (i) increases in net earnings; (ii) return on
          equity; (iii) average equity used; or (iv) growth in assets.
</TABLE>

 
                                      A-1

<PAGE>

<TABLE>
<S>       <C>
(j)       "Performance Period" means, in relation to any award the
          calendar year (or remaining portion of the calendar year if
          the award is made after March 31 of any year) for which
          performance is being calculated, with each such period
          constituting a separate Performance Period.
(k)       "Performance Threshold" means, in relation to any
          Performance Period, the minimum level of performance that
          must be achieved with respect to the Performance Measure in
          order for an award to become payable pursuant to Section 2.5
          hereof.
(l)       "Target Award" means that percentage of a Participant's
          annual base salary for the Performance Period which the Plan
          Administrator set as the maximum amount to be awarded under
          the Plan for such Performance Period.
</TABLE>

 
1.3  ADMINISTRATION
 
      The Plan shall be administered by the Committee. Subject to the terms of
the Plan, the Committee shall, among other things, determine eligibility for
participation in the Plan, make awards under the Plan, establish the terms and
conditions of such awards (including the Performance Measure(s) to be utilized)
and determine whether the Performance Measures and Performance Thresholds for
any award have been achieved. A majority of the Committee shall constitute a
quorum, and the acts of a majority of the members present at any meeting at
which a quorum is present, or acts approved in writing by a majority of the
Committee, shall be deemed the acts of the Committee. Subject to the provisions
of the Plan and to directions by the Board, the Committee is authorized to
interpret the Plan, to adopt administrative rules, regulations, and guidelines
for the Plan, and to impose such terms, conditions, and restrictions on awards
as it deems appropriate. The Committee may, with respect to Participants who are
not subject to Section 16 of the Exchange Act and Section 162(m) of the Code,
delegate such of its powers and authority under the Plan to the Company's
Chairman, President or Chief Executive Officer as it deems appropriate. In the
event of such delegation, all references to the Committee in this Plan shall be
deemed references to such officers as it relates to those aspects of the Plan
that have been delegated.
 
1.4  ELIGIBILITY AND PARTICIPATION
 
      Participation in the Plan shall be limited to officers, who may also be
members of the Board, and other employees of the Company who are determined by
the Committee to be eligible for participation in the Plan.
 
                           ARTICLE II -- AWARD TERMS
 
2.1  GRANTING OF AWARDS
 
      The Committee may, in its discretion, from time to time make awards to
persons eligible for participation in the Plan pursuant to which the Participant
will earn compensation in the event that the Company achieves the Performance
Thresholds established by the Committee. Each award shall be evidenced by a
written agreement between the Company and the Participant (the "Award
Agreement"). The Award Agreement shall specify, among other things, the terms
and conditions of the award and the Performance Targets to be achieved.
 
2.2  ESTABLISHMENT OF PERFORMANCE THRESHOLDS
 
      Each award shall be conditioned upon the Company's achievement of one or
more Performance Thresholds with respect to the Performance Measure(s)
established by the Committee prior to the beginning of the applicable
Performance Period and set forth in the Award Agreement. The Committee, in its
discretion, may establish Performance Thresholds for the Company as a whole or
for only the business unit of the Company in which a given Participant is
involved, or a combination thereof. In addition to establishing a minimum
performance level below which no compensation shall be payable pursuant to an
award, the Committee, in its discretion, may create a performance schedule under
which an amount less than the Target Award may be paid so long as the
Performance Threshold has been exceeded. The Committee may adjust the
Performance Thresholds and measurements to reflect significant unforeseen
events; provided, however, that the Committee may not make any such
 
                                      A-2

<PAGE>
adjustment with respect to any award to an individual who is then a "covered
employee" as such term is defined in Regulation 1.162-27(c)(2) promulgated under
Section 162(m) of the Code, or any successor provision ("Section 162(m)"), if
such adjustment would cause compensation pursuant to such award to cease to be
performance-based compensation under Section 162(m).
 
2.3  OTHER AWARD TERMS
 
      The Committee may, in its sole discretion, establish certain additional
performance based conditions that must be satisfied by the Company, a business
unit or the Participant as a condition precedent to the payment of all or a
portion of any awards. Such conditions precedent may include, among other
things, the receipt by a Participant of a specified annual performance rating
and the achievement of specified performance goals by the Company, business unit
or Participant.
 
2.4  CERTIFICATION OF ACHIEVEMENT OF PERFORMANCE THRESHOLDS
 
      The Committee shall, prior to any payment under the Plan, certify in
writing the extent, if any, that the Performance Threshold has been achieved.
For purposes of this provision, and for so long as the Code permits, the
approved minutes of the Committee meeting in which the certification is made
shall be treated as written certification.
 
2.5  DISTRIBUTION OF AWARDS
 
      Awards under the Plan shall be paid in cash as soon as practicable after
appropriate financial statements for the Performance Period have been prepared
and the Committee has certified that the Performance Threshold has been
achieved. Notwithstanding the foregoing, the Committee may, in it sole
discretion, elect to pay all or a portion of the total award value in the form
of non-qualified stock options to purchase Common Stock, in lieu of paying such
amount in cash. Any options granted as payment of an award shall be granted
pursuant to the Ocwen Financial Corporation 1991 Non-Qualified Stock Option Plan
or any successor thereto.
 
2.6  TERMINATION OF EMPLOYMENT
 
      A Participant must be actively employed by the Company on the date his or
her award is to be paid ("the Payment Date") in order to be entitled to payment
of any award. In the event active employment of a Participant shall be
terminated before the Payment Date for any reason other than discharge for
Cause, such Participant shall not be entitled to receive any award unless
otherwise determined by the Committee. A Participant discharged for Cause shall
not be entitled to receive any award for the year.
 
2.7  MAXIMUM AMOUNT AVAILABLE FOR AWARDS
 
      The aggregate maximum amount payable to any one Participant for any
Performance Period shall be $2 million.
 
                        ARTICLE III -- OTHER PROVISIONS
 
3.1  WITHHOLDING TAXES
 
      Whenever payments under the Plan are to be made, the Company will withhold
therefrom an amount sufficient to satisfy any applicable governmental
withholding tax requirements related thereto.
 
3.2  ADJUSTMENTS
 
      Awards may be adjusted by the Committee in the manner and to the extent it
determines to be appropriate in the event of changes in the outstanding shares
of Common Stock by reason of stock dividends, stock splits, recapitalizations,
reorganizations, mergers, consolidations, combinations, exchanges,
reclassifications or other relevant changes in capitalization occurring after
the date of the award.
 
                                      A-3

<PAGE>
3.3  NO RIGHT TO EMPLOYMENT
 
      Nothing contained in the Plan or in any Award Agreement shall confer upon
any Participant any right with respect to continued employment with the Company
or its subsidiaries, nor interfere in any way with the right of the Company or
its subsidiaries to at any time reassign the Participant to a different job,
change the compensation of the Participant or terminate the Participant's
employment for any reason.
 
3.4  NONTRANSFERABILITY
 
      A Participant's rights under the Plan, including the right to any shares
or amounts payable may not be assigned, pledged, or otherwise transferred
without the written consent of the Committee except, in the event of a
Participant's death, to the Participant's designated beneficiary or, in the
absence of such a designation, by will or by the laws of descent and
distribution.
 
3.5  DEFERRAL OF PAYMENT
 
      At the discretion of the Committee, a Participant may be required to defer
the receipt of up to 25% of any award otherwise payable to such Participant.
Such deferral shall be accomplished by the execution of a written deferral
agreement by the Participant prior to the expiration of the Performance Period.
Any compensation deferred pursuant to this Section shall earn interest during
the deferral period at a rate equal to 1/2 of the percentage increase in
Business Value created during such period as such term is defined in the Ocwen
Financial Corporation Long-Term Incentive Plan or any successor thereto
identified by the Committee. All other terms and conditions of deferred payments
shall be as contained in the deferred compensation agreement.
 
3.6  UNFUNDED PLAN
 
      Unless otherwise determined by the Committee, the Plan shall be unfunded
and shall not create (or be construed to create) a trust or separate funds. With
respect to any payment not yet made to a Participant, nothing contained herein
shall give any Participant any rights that are greater than those of a general
creditor of the Company.
 
3.7  FOREIGN JURISDICTIONS
 
      The Committee shall have the authority to adopt, amend, or terminate such
arrangements, not inconsistent with the intent of the Plan, as it may deem
necessary or desirable to comply with the tax or other laws of foreign countries
or jurisdictions in order to promote achievement of the purposes of the Plan
with respect to Participants residing or working in such jurisdictions.
 
3.8  OTHER COMPENSATION PLANS
 
      Nothing contained in this Plan shall prevent the Company from adopting
other or additional compensation arrangements for employees of the Company.
 
                    ARTICLE IV -- AMENDMENT AND TERMINATION
 
      The Board of Directors may modify, amend, or terminate the Plan at any
time except that, no modification, amendment, or termination of the Plan shall
adversely affect the rights of a Participant under an award previously made to
such Participant without the consent of such Participant.
 
                          ARTICLE V -- EFFECTIVE DATE
 
      The Plan shall become effective immediately upon the approval and adoption
thereof by Board, but is subject to the further approval and adoption by the
shareholders of the Company.
 
                                      A-4

<PAGE>
                                                                       EXHIBIT B
 
                          OCWEN FINANCIAL CORPORATION
                            LONG-TERM INCENTIVE PLAN
 
                        ARTICLE I -- GENERAL PROVISIONS
 
1.1  PURPOSE
 
      The purpose of the Ocwen Financial Corporation Long-Term Incentive Plan
(the "Plan") is to advance the long-term success of Ocwen Financial Corporation
and to thereby increase shareholder value by providing the incentive of
long-term stock-based rewards to the officers and key employees of the Company
primarily responsible for that success. The Plan is designed to: (i) further
align the interests of Participants with the interests of the Company's
shareholders, (ii) reward Participants for creating shareholder value as
measured by objectively determinable performance goals and (iii) assist in the
attraction and retention of employees vital to the Company's long-term success.
 
1.2  DEFINITIONS
 
      For the purpose of the Plan, the following terms shall have the meanings
indicated:
 

<TABLE>
<S>       <C>
(a)       "Board" means the Board of Directors of the Company.
 
(b)       "Basis Point" means a right awarded to a Participant
          pursuant to Article II, which right, unless the Committee
          determines otherwise, represents value, payable in the form
          of Restricted Stock, equal to the number of Basis Points
          awarded to a Participant for a Performance Period divided by
          10,000 and multiplied by the Business Value for such
          Performance Period.
 
(c)       "Basis Points Award Agreement" means a written agreement
          between the Company and the Participant to whom Basis Points
          are awarded evidencing the award.
 
(d)       "Business Value" means, in relation to any Performance
          Period, the cumulative business value that is determined to
          have been created with respect to the Company or the
          business unit in question, as the case may be, based upon
          the Company or business unit's achievement of Performance
          Targets with respect to such Performance Period.
 
(e)       "Code" means the Internal Revenue Code of 1986, as amended,
          including any successor law thereto.
 
(f)       "Company" means Ocwen Financial Corporation and, solely for
          purposes of determining (i) eligibility for participation in
          the Plan, (ii) employment, and (iii) the calculation of any
          performance goal, shall include any corporation,
          partnership, or other organization of which the Company owns
          or controls, directly or indirectly, not less than 50
          percent of the total combined voting power of all classes of
          stock or other equity interests. For purposes of this Plan,
          the term "Company" shall include any successor to Ocwen
          Financial Corporation.
 
(g)       "Committee" means the Nominating and Compensation Committee
          of the Board (or any successor committee of the Board
          performing a similar function or the whole Board if the
          Board performs such functions) or, with respect to any
          particular function under the Plan identified by the
          Committee or the Board, any subcommittee of the whole
          Committee established by the whole Committee or the Board in
          order to comply with the definition of Non-Employee Director
          under Rule 16b-3 of the Exchange Act and the definition of
          outside director under Section 162(m) of the Code.
 
(h)       "Common Stock" means the Company's Common Stock, par value
          $.01 per share.
 
(i)       "Covered Employee" shall have the meaning set forth in
          Regulation 1.162-27(c)(2) promulgated under Section 162(m)
          of the Code, or any successor provision to Section 162(m).
</TABLE>

 
                                      B-1

<PAGE>

<TABLE>
<S>       <C>
(j)       "Deferred Compensation Trust" means the nonqualified
          irrevocable trust established by the Company for the benefit
          of the Participants until all shares are payable to the
          Participants in accordance with the terms of Article IV.
 
(k)       "Disability" means total and permanent disability within the
          meaning of Section 22(e)(3) of the Code.
 
(l)       "Exchange Act" means the Securities Exchange Act of 1934, as
          amended.
 
(m)       "Fair Market Value" means the average of the daily weighted
          average sales price of the Common Stock as reported on a
          nationally recognized financial reporting system (e.g.
          Bloomberg) (or in absence of the ready availability of such
          information, the average of the daily average of the high
          and low sales prices of the Common Stock as reported on the
          New York Stock Exchange Composite Transactions reporting
          system) for the 20 consecutive trading days immediately
          preceding the applicable date.
 
(n)       "Participant" means any person who has satisfied the
          eligibility requirements set forth in Section 1.6 and to
          whom the Committee has awarded Basis Points under the Plan,
          which Basis Points are either outstanding under the Plan or
          have been paid in the form of Restricted Stock, as to which,
          Common Stock has not yet been issued to such person.
 
(o)       "Payment Event" means the earliest to occur of one of the
          following events: (i) the termination of the Participant's
          employment with the Company other than by reason of death,
          Disability or Retirement; (ii) the Participant's Retirement;
          (iii) the Participant's Disability; or (iv) the
          Participant's death.
 
(p)       "Performance Period" means, in relation to any award of
          Basis Points, any period for which performance goals have
          been established.
 
(q)       "Performance Target(s)" means, in relation to any
          Performance Period, the specified level of performance
          established by the Committee with respect to earnings per
          share and/or return on equity, as the case may be, in order
          for Basis Points to become payable pursuant to Section 2.5
          hereof.
 
(r)       "Restricted Period" means that period of time that shares of
          Restricted Stock are subject to the restrictions set forth
          in Section 3.3 of the Plan which shall begin at the end of
          the Performance Period.
 
(s)       "Retirement" means termination from employment with the
          Company after the Participant has attained age 55 and has
          completed five years of service with the Company or
          termination of employment under circumstances which the
          Committee deems equivalent to retirement, in either case
          which is not followed by the subsequent re-employment of the
          Participant without the prior written consent of the
          Company.
</TABLE>

 
1.3  ADMINISTRATION
 
      The Plan shall be administered by the Committee. Subject to the terms of
the Plan, the Committee shall, among other things, determine eligibility for
participation in the Plan, make awards of Basis Points under the Plan, establish
the terms and conditions of such awards (including the number of Basis Points to
be awarded to each Participant and the applicable Performance Period and
performance goals for such Basis Points), determine whether the Performance
Targets for any award have been achieved and determine the vesting provisions
and Restricted Period for any Restricted Stock earned pursuant to such Basis
Points. A majority of the Committee shall constitute a quorum, and the acts of a
majority of the members present at any meeting at which a quorum is present, or
acts approved in writing by a majority of the Committee, shall be deemed the
acts of the Committee. Subject to the provisions of the Plan and to directions
by the Board, the Committee is authorized to interpret the Plan, to adopt
administrative rules, regulations, and guidelines for the Plan, and to impose
such terms, conditions, and restrictions on awards as it deems appropriate. The
Committee may, with respect to Participants who are not subject to Section 16 of
the Exchange Act and Section 162(m) of
 
                                      B-2

<PAGE>
the Code, delegate such of its powers and authority under the Plan to the
Company's Chairman, President or Chief Executive Officer as it deems
appropriate. In the event of such delegation, all references to the Committee in
this Plan shall be deemed references to such officers as it relates to those
aspects of the Plan that have been delegated.
 
1.4  TYPES OF AWARDS UNDER THE PLAN AND PER PARTICIPANT LIMITATION
 
      Awards under the Plan shall be in the form of Basis Points which, to the
extent earned, shall be payable in the form of Restricted Stock. The maximum
amount that shall be payable to any one Participant pursuant to any one
Performance Period shall be $25 million.
 
1.5  SHARES SUBJECT TO THE PLAN
 
      The maximum number of shares of Common Stock that may be issued under the
Plan shall be equal to 6.0% of the number of shares of Common Stock outstanding
from time to time; provided, that, subject to Section 6.2, the maximum number of
shares of Common Stock that may be issued under the Plan shall not decrease by
reason of a decrease in the number of shares outstanding. The total number of
shares available for issuance is subject to adjustment as provided in Section
6.2. Shares of Common Stock issued under the Plan may be treasury shares or
authorized but unissued shares. No fractional shares shall be issued under the
Plan; any such fractional shares shall be rounded up to the next whole share.
Shares of Common Stock that have been reserved for issuance in payment for Basis
Points or Restricted Stock but are later reacquired by the Company, canceled,
forfeited or for any other reason are not issued under the Plan shall
automatically become available for the purposes of the Plan.
 
1.6  ELIGIBILITY AND PARTICIPATION
 
      Participation in the Plan shall be limited to officers, who may also be
members of the Board, and other employees of the Company who are determined by
the Committee to be responsible for the long-term success of the Company.
 
                           ARTICLE II -- BASIS POINTS
 
2.1  AWARD OF BASIS POINTS
 
      The Committee may, in its discretion, from time to time, award Basis
Points under the Plan to persons eligible for participation in the Plan pursuant
to which Basis Points a Participant will earn shares of Restricted Stock if the
Company achieves the Performance Targets established by the Committee for the
Performance Period applicable to such award. Such Basis Points shall be subject
to the provisions of the Plan and the Basis Points Award Agreement pursuant to
which the Basis Points are awarded. Unless the Committee determines otherwise,
twenty percent (20%) of the Basis Points awarded to a Participant at the
beginning of the Performance Period shall be forfeited by the Participant for
each year during the Performance Period that the Participant fails to achieve at
least ninety percent (90%) of such Participant's annual target performance under
the Ocwen Financial Corporation 1998 Annual Incentive Plan or other annual
review process identified by the Committee. Furthermore, the Committee may
provide that the commission of certain acts by the Participants in relation to
the performance of their duties to the Company will result in a forfeiture of
all or a portion of any Basis Points awarded. A Participant shall have no
further rights with respect to any such forfeited Basis Points.
 
2.2  BASIS POINTS AWARD AGREEMENT
 
      Each award of Basis Points shall be evidenced by a Basis Points Award
Agreement. The Basis Points Award Agreement shall specify, among other things,
the terms and conditions of the award, the duration of the Performance Period,
the Performance Targets to be achieved, and the vesting provisions and
Restriction Period applicable to shares of Restricted Stock earned.
 
                                      B-3

<PAGE>
2.3  PERFORMANCE GOALS
 
      Each award of Basis Points shall be conditioned upon the Company's
achievement of one or more Performance Targets established by the Committee for
the applicable Performance Period and set forth in the Basis Points Award
Agreement. The Committee, in its discretion, may establish Performance Targets
for the Company as a whole or for only the business unit of the Company in which
a given Participant is involved, or a combination thereof. The Committee may
adjust the Performance Targets and measurements to reflect significant
unforeseen events; provided, however, that the Committee may not make any such
adjustment with respect to any award of Basis Points to an individual who is
then a Covered Employee, if such adjustment would cause compensation pursuant to
such Basis Points award to cease to be performance-based compensation under
Section 162(m) of the Code.
 
2.4  PERFORMANCE PERIOD
 
      The Committee shall establish a Performance Period applicable to each
award of Basis Points. Unless the Committee determines otherwise, the
Performance Period for each award of Basis Points shall be five (5) years. There
shall be no limitation on the number of Performance Periods established by the
Committee, and more than one Performance Period may encompass the same calendar
year. The Committee may lengthen or shorten any Performance Period if it
determines that unusual or unforeseen events so warrant; provided, however, that
no such adjustment shall be made with respect to any award to a Covered Employee
if such adjustment would cause compensation pursuant to such Basis Points Award
to cease to be performance-based compensation under Section 162(m) of the Code.
 
2.5  RIGHT TO PAYMENT OF RESTRICTED STOCK
 

<TABLE>
<S>       <C>
(a)       Within ninety (90) days after the end of each Performance
          Period, the Committee shall determine the value of the Basis
          Points based on the Company's performance in relation to the
          established Performance Targets for such Basis Points.
(b)       Within one hundred twenty (120) days after the end of the
          applicable Performance Period, the Company shall pay to the
          Participant the value of such Participant's Basis Points in
          the form of shares of Restricted Stock based on the Fair
          Market Value of the Common Stock on the last day of the
          Performance Period pursuant to which such payment is made.
          Such Restricted Stock shall be subject to the restrictions
          set forth in Article III hereof and shall be represented by
          a certificate of Common Stock registered in the name of the
          Participant but held in the custody of the Company until
          such restrictions lapse or are waived.
</TABLE>

 
2.6  TERMINATION OF EMPLOYMENT DURING A PERFORMANCE PERIOD
 

<TABLE>
<S>       <C>
(a)       In the event a Participant terminates employment with the
          Company during a Performance Period for any reason, other
          than by reason of death, Disability or Retirement, all Basis
          Points theretofore awarded to the Participant shall
          terminate and the Participant shall forfeit all rights to
          earn Restricted Stock pursuant to such Basis Points.
(b)       In the event a Participant terminates employment with the
          Company during a Performance Period by reason of death,
          Disability or Retirement, the Participant shall retain all
          Basis Points theretofore awarded and the Participant (or the
          Participant's beneficiary) shall be entitled to payment
          pursuant to Section 2.5 provided that the amount payable to
          or on behalf of such Participant shall be reduced on a
          prorated basis in order to reflect the number of months of
          employment during the Performance Period that the
          Participant was employed by the Company.
(c)       Notwithstanding Section 2.6(a), in the event a Participant's
          employment terminates under special circumstances, the
          Committee may, in its sole discretion, continue a
          Participant's rights to earn all or a portion of the
          Restricted Stock which such Participant would have otherwise
          earned pursuant to such Participant's Basis Points had such
          Participant remained employed with the Company.
</TABLE>

 
                                      B-4

<PAGE>
                        ARTICLE III -- RESTRICTED STOCK
 
3.1  VESTING OF RESTRICTED STOCK
 
      At the time an award of Basis Points is made, the Committee shall
establish the terms on which any Restricted Stock earned pursuant to such Basis
Points shall vest. Unless the Committee determines otherwise, the Restricted
Stock shall, subject to Section 3.1(a), vest and become nonforfeitable in equal
annual installments during the period beginning on the first anniversary of the
last day of the Performance Period for which Restricted Stock was earned and
ending on the tenth anniversary thereof.
 

<TABLE>
<S>       <C>
(a)       Upon vesting, shares of Restricted Stock shall be placed
          into the Deferred Compensation Trust for the benefit of the
          Participant until such shares are payable to the Participant
          in accordance with the terms of Article IV. The assets of
          the Deferred Compensation Trust, including the shares of
          Restricted Stock held by the trust and any income thereon,
          shall be subject to the claims of the Company's creditors in
          the event of bankruptcy or insolvency.
 
(b)       Upon termination of a Participant's employment with the
          Company for any reason, other than by reason of death,
          Disability or Retirement, all unvested shares of Restricted
          Stock shall be forfeited by the Participant to the Company
          and the Participant shall have no further rights with
          respect thereto.
 
(c)       Upon termination of a Participant's employment with the
          Company by reason of death, Disability or Retirement, all
          unvested shares of Restricted Stock shall be vested and
          shall be paid out to the Participant in accordance with the
          terms of Article IV.
</TABLE>

 
3.2  RESTRICTED PERIOD
 
      At the time an award of Basis Points is made, the Committee shall
establish a Restricted Period applicable to all Restricted Stock. Unless the
Committee determines otherwise, the Restricted Period for shares of vested
Restricted Stock shall begin on the last day of the Performance Period for which
the Restricted Stock was earned and end on the date that such shares are payable
to the Participant in accordance with the terms of Article IV.
 
3.3  RESTRICTIONS
 
      During the Restricted Period, the Restricted Stock shall be subject to the
following terms and conditions:
 

<TABLE>
<S>       <C>
(a)       The Participant shall not be permitted to sell, assign,
          transfer, pledge, hypothecate or otherwise dispose of any
          shares of Restricted Stock.
 
(b)       Except as otherwise provided herein or in the Basis Points
          Award Agreement, the Participant shall have all the rights
          of a shareholder of the Company, including the right to vote
          the shares.
 
(c)       Cash dividends, if any, paid with respect to Restricted
          Stock shall be reinvested to purchase additional shares of
          Common Stock that shall be subject to the same terms,
          conditions, and restrictions that apply to the Restricted
          Stock with respect to which such dividends were issued.
</TABLE>

 
3.4  LAPSE OF RESTRICTIONS
 
      Vested shares of Restricted Stock shall become free of the restrictions
imposed by Section 3.3 upon the occurrence of a Payment Event. The Committee may
provide for the lapse of the restrictions applicable to vested shares of
Restricted Stock based on such other factors as the Committee may determine and
set forth in the Basis Point Award Agreement.
 
                                      B-5

<PAGE>
                             ARTICLE IV -- PAYMENT
 
      Upon the occurrence of a Payment Event all shares of Common Stock held in
the Deferred Compensation Trust for the Participant shall be payable as follows:
(i) in the event of a termination other than by reason of death, Disability or
Retirement, in five equal installments of 20% of such shares which shall be
delivered to the Participant within 30 days following each of the next five (5)
anniversaries of the Payment Event; or (ii) in the event of death, Disability or
Retirement, in five equal installments of 20% of such shares which shall be
delivered to the Participant within 30 days following each of the next five (5)
anniversaries of the end of the next Performance Period to expire under the Plan
following such Participant's death, Disability or Retirement (or if no
Performance Period is then pending, within 30 days following the next five (5)
anniversaries of a date to be determined by the Committee, which date may not be
more than three (3) years following the date of such Participant's termination
of employment). Notwithstanding the foregoing, the Committee may, in its sole
discretion, determine to deliver all or a portion of the Common Stock held in
the Deferred Compensation Trust earlier than provided by the preceding sentence.
 
                       ARTICLE V -- SHARE TAX WITHHOLDING
 
      At the discretion of the Committee, the Committee may permit a Participant
to elect to satisfy, in whole or in part, any tax withholding obligations in
connection with the issuance of shares of Common Stock earned under the Plan by
requesting that the Company either: (i) withhold shares of Common Stock
otherwise issuable to the Participant; or (ii) by accepting delivery of shares
of Common Stock previously owned by the Participant. In either case, unless
otherwise determined by the Committee, the Fair Market Value of such shares of
Common Stock will generally be determined on the date on which the tax due is
determined. Shares of Common Stock previously acquired by the Participant under
the Plan shall not be utilized for satisfaction of any withholding obligation
unless those shares have been owned by the Participant for a six-month period or
such longer period as the Committee may determine. Notwithstanding any other
provision hereof to the contrary, the Committee, in its sole discretion, may at
any time suspend, terminate, or disallow any or all entitlements previously
granted to a Participant to use previously owned shares or the withholding of
shares otherwise issuable to satisfy tax withholding obligations.
 
                         ARTICLE VI -- OTHER PROVISIONS
 
6.1  CASH AWARDS
 
      The Committee may, in its discretion, from time to time, award Basis
Points under the Plan which are payable in cash. The terms of any such awards
shall be evidenced by a written agreement between the Company and the
Participant.
 
6.2  ADJUSTMENT IN NUMBER OF SHARES
 
      Awards of Basis Points may be adjusted by the Committee in the manner and
to the extent it determines to be appropriate in the event of changes in the
outstanding shares of Common Stock by reason of stock dividends, stock splits,
recapitalizations, reorganizations, mergers, consolidations, combinations,
exchanges, reclassifications or other relevant changes in capitalization
occurring after the date of the award. In the event of any such change in the
outstanding shares, the aggregate number of shares of Common Stock available for
issuance under the Plan may be appropriately adjusted by the Committee.
 
6.3  NO RIGHT TO EMPLOYMENT
 
      Nothing contained in the Plan or in any Basis Point Award Agreement shall
confer upon any Participant any right with respect to continued employment with
the Company or its subsidiaries, nor interfere in any way with the right of the
Company or its subsidiaries to at any time reassign the
 
                                      B-6

<PAGE>
Participant to a different job, change the compensation of the Participant or
terminate the Participant's employment for any reason.
 
6.4  NONTRANSFERABILITY
 
      A Participant's rights under the Plan, including the right to any shares
or amounts payable may not be assigned, pledged, or otherwise transferred
without the consent of the Company except, in the event of a Participant's
death, to the Participant's designated beneficiary or, in the absence of such a
designation, by will or by the laws of descent and distribution.
 
6.5  COMPLIANCE WITH GOVERNMENT REGULATIONS AND INTERPRETATION
 
      The Company shall not be required to issue or deliver shares or make
payment upon any right awarded under the Plan prior to complying with the
requirements of any governmental authority in connection with the authorization,
issuance, or sale of such shares. The Plan shall be construed and its provisions
enforced and administered in accordance with the laws of the State of Florida
applicable to contracts entered into and performed entirely in such State. In
the event that any term of the Plan shall be deemed unenforceable as a matter of
law, such term shall be deemed modified to the extent necessary to be
enforceable and such term as modified shall be enforced to the fullest extent
permitted by law.
 
6.6  RIGHTS AS A SHAREHOLDER
 
      Subject to the express terms of the Plan, a Participant shall have no
rights as a shareholder with respect to any award under the Plan unless and
until certificates for shares of Common Stock are issued in the name of such
Participant.
 
6.7  UNFUNDED PLAN
 
      Unless otherwise determined by the Committee, the Plan shall be unfunded
and shall not create (or be construed to create) a trust or separate funds. With
respect to any payment not yet made to a Participant, nothing contained herein
shall give any Participant any rights that are greater than those of a general
creditor of the Company.
 
6.8  FOREIGN JURISDICTIONS
 
      The Committee shall have the authority to adopt, amend, or terminate such
arrangements, not inconsistent with the intent of the Plan, as it may deem
necessary or desirable to comply with the tax or other laws of foreign countries
in order to promote achievement of the purposes of the Plan.
 
6.9  OTHER COMPENSATION PLANS
 
      Nothing contained in this Plan shall prevent the Company from adopting
other or additional compensation arrangements for employees of the Company.
 
6.10  TERMINATION OF EMPLOYMENT -- CERTAIN FORFEITURES
 
      Notwithstanding any other provision of the Plan, a Participant shall have
no right to receive payment of any Common Stock if: (i) the Participant is
discharged for willful, deliberate, or gross misconduct as determined by the
Committee in its sole discretion, (ii) if following the Participant's
termination of employment with the Company by reason other than Retirement, and
within a period of five years thereafter, the Participant engages in any
business or enters into any employment which the Committee in its sole and
absolute discretion determines to be (a) directly or indirectly competitive with
the business of the Company or (b) substantially injurious to the Company's
interests; or (iii) if following the Participant's termination of employment
with the Company by reason of Retirement, the Participant engages in any
business or enters into any employment without the prior written consent of the
Company. A Participant may request the Committee in writing to determine whether
any proposed
 
                                      B-7

<PAGE>
business or employment activity would justify such a forfeiture. Such a request
shall fully describe the proposed activity and the Committee's determination
shall be limited to the specific activity so described.
 
                    ARTICLE VII -- AMENDMENT AND TERMINATION
 
      The Board of Directors may modify, amend, or terminate the Plan at any
time except that, to the extent then required by applicable law, rule, or
regulation, approval of the holders of a majority of shares of Common Stock
represented in person or by proxy at a meeting of the shareholders will be
required to increase the maximum number of shares of Common Stock available for
issuance under the Plan (other than increases due to adjustments in accordance
with the Plan). No modification, amendment, or termination of the Plan shall
adversely affect the rights of a Participant under an award previously made to
such Participant without the consent of such Participant.
 
                         ARTICLE VIII -- EFFECTIVE DATE
 
      The Plan shall become effective immediately upon the approval and adoption
thereof by the Board, but is subject to the further approval and adoption by the
shareholders of the Company.
 
                                      B-8

<PAGE>
                                REVOCABLE PROXY
 
                          OCWEN FINANCIAL CORPORATION
        1675 PALM BEACH LAKES BOULEVARD, WEST PALM BEACH, FLORIDA 33401
 
    THIS PROXY IS BEING SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS OF OCWEN
FINANCIAL CORPORATION, FOR USE ONLY AT THE ANNUAL MEETING OF SHAREHOLDERS TO BE
HELD ON MAY 13, 1998 AND AT ANY ADJOURNMENT THEREOF.
 
    The undersigned hereby appoints John R. Erbey, William C. Erbey and
Christine A. Reich, or any of them, as proxy, with full powers of substitution,
and hereby authorizes them to represent and vote, as designated below, all the
shares of Common Stock of Ocwen Financial Corporation (the "Company") held of
record by the undersigned on March 15, 1998 at the Annual Meeting of
Shareholders to be held at the first floor offices of the Company located at
1675 Palm Beach Lakes Boulevard, West Palm Beach, Florida 33401 on Wednesday,
May 13, 1998 at 9:00 a.m., Eastern Time, and at any adjournment thereof.
 
1. ELECTION OF DIRECTORS
 

<TABLE>
<S>                                         <C>                                 <C>
/ / FOR all nominees listed below                 WITHHOLD AUTHORITY / /                  EXCEPTIONS / /
   (except as indicated)                     to vote for all nominees listed
                                                          below
</TABLE>

 
 William C. Erbey, Hon. Thomas F. Lewis, W.C. Martin, Howard H. Simon and Barry
                                    N. Wish.
 
 (INSTRUCTIONS: To withhold authority to vote for any individual nominee, mark
the "Exceptions" box and write that nominee's name in the space provided below.)
- --------------------------------------------------------------------------------
 
2. PROPOSAL to adopt the Ocwen Financial Corporation 1998 Annual Incentive
Plan.                            / / FOR         / / AGAINST         / / ABSTAIN
 
3. PROPOSAL to adopt the Ocwen Financial Corporation Long Term Incentive
Plan.                            / / FOR         / / AGAINST         / / ABSTAIN

<PAGE>
4. RATIFICATION OF THE APPOINTMENT by the Board of Directors of Price Waterhouse
   LLP as the independent auditor of the Company for the fiscal year ending
   December 31, 1998.            / / FOR         / / AGAINST         / / ABSTAIN
 
    In their discretion, the proxies are authorized to vote upon such other
business as may properly come before the Annual Meeting.
 
    SHARES OF COMMON STOCK OF THE COMPANY WILL BE VOTED AS SPECIFIED. IF NOT
OTHERWISE SPECIFIED, THIS PROXY WILL BE VOTED FOR THE ELECTION OF THE BOARD OF
DIRECTORS' NOMINEES TO THE BOARD OF DIRECTORS, FOR THE ADOPTION OF THE COMPANY'S
1998 ANNUAL INCENTIVE PLAN, FOR THE ADOPTION OF THE COMPANY'S LONG-TERM
INCENTIVE PLAN, AND FOR THE APPOINTMENT OF PRICE WATERHOUSE LLP AS THE
INDEPENDENT AUDITOR. YOU MAY REVOKE THIS PROXY AT ANY TIME PRIOR TO THE TIME IT
IS VOTED AT THE ANNUAL MEETING.
 
    The undersigned hereby acknowledges receipt of the Notice of Annual Meeting
of Shareholders of the Company to be held on May 13, 1998, or any adjournment
thereof, a Proxy Statement for the Annual Meeting and the 1997 Annual Report to
Shareholders of the Company prior to the signing of this proxy.
 
                                             ___________________________________
 
                                                         Signatures
 
                                             ___________________________________
 
                                             Dated: ____________________________
 
                                             Please sign exactly as your name(s)
                                             appear(s) on this Proxy. When
                                             signing in a representative
                                             capacity, please give title. When
                                             shares are held jointly, both
                                             owners should sign. PLEASE MARK,
                                             SIGN, DATE AND RETURN THIS PROXY
                                             PROMPTLY USING THE ENCLOSED
                                             ENVELOPE.

                                             Please check / / if you plan to
                                             attend the meeting.