New rules bring fairness to foreclosures

Andrew Cates | Issues columnist

Jan. 31, 2013

Last week, the Consumer Financial Protection Bureau released a new set of mortgage servicing rules designed to ensure that homeowners in trouble get a fair and accurate process to help them avoid foreclosure. The rules are numerous, but the goal is to make sure that homeowners who have a mortgage are told about their options and given adequate time to consider alternatives to foreclosing their home. Some of the new rules include:

Servicers must let borrowers know about their “loss mitigation options” to retain their home after borrowers have missed two consecutive payments.
Servicers cannot foreclose on a property if the borrower and servicer have come to a loss-mitigation agreement, unless the borrower fails to perform under that agreement.
Servicers must generally acknowledge receipt of written notices from consumers regarding certain errors or requesting information about their mortgage loans. Generally, within 30 days, the servicer must: correct the error and provide the information requested; conduct a reasonable investigation and inform the borrower why the error did not occur; or inform the borrower that the information requested is unavailable.

Read more about the new rules and how they protect consumers against foreclosure from the Consumer Financial Protection Bureau.

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