Feb. 12, 2013 – The CFPB is making mortgage-servicing transfer problems a focus of its supervisory activities given the impact on millions of borrowers of poorly handled transfers and homeowners’ own challenges keeping current on their loans, the bureau said in a bulletin Monday.
In CFPB Bulletin 2013-01, the bureau outlines its authorities and responsibilities under federal consumer protection laws for ensuring consumers aren’t harmed by the servicing transfer process. This focuses on ensuring that mortgage servicing transfers ensure the complete and timely transfer of mortgage documents – including loss-mitigation information and crediting of payments.
The bureau said it has a “heightened concern” about servicing transfer practices given the large number and size of recent servicing transfers. “Consumers should not be collateral damage in the mortgage servicing transfer process,” said CFPB Director Richard Cordray. “This guidance directs all mortgage servicers, both banks and nonbanks, to follow the laws protecting borrowers from the risks of such transfers, and makes clear that we will be monitoring them for compliance.”
The bureau is also focusing on concerns arising due to consumer complaints about and supervisory work related to mortgage servicing transfers, including those related to service interruptions when loans are transferred during the loss mitigation process.
The bureau notes its recent final rule on mortgage servicing and an FHFA statement issued Monday supporting Bulleting 2013-01.
These are other mortgage-loan-related rules from the CFPB will be discussed during NAFCU’s webcast tomorrow on the CFPB’s recent final rules; it is part of the association’s CFPB Mortgage Reform Webcast Series being held throughout 2013.