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.