January 13, 2014

NCUA alert out on CFPB's RESPA servicing rule

Jan. 14, 2014 – NCUA issued a regulatory alert on how credit unions are affected by CFPB's new Real Estate Settlement Procedures Act mortgage servicing rule, which deals with force-placed insurance, loss mitigation and other issues.

NCUA explained that small servicers are exempt from parts of the rule but still must comply with most of the force-placed insurance provision, the error resolution and information requests provision, and two parts of the loss mitigation provision. That includes requirements that servicers not make the first notice or filing for foreclosure before 120 days of delinquency and prohibiting them from proceeding to foreclosure judgment if the member is following terms of a loss mitigation agreement.

NCUA also said additional mortgage servicing requirements – for small servicers and others – may apply under the new Truth in Lending Act mortgage servicing rule and referred credit unions to another regulatory alert.