Mortgage servicers are responsible for collecting payments from the mortgage borrower on behalf of the loan’s owner. They also typically handle customer service, escrow accounts, collections, loan modifications, and foreclosures.
The Dodd-Frank Act imposes certain requirements on servicers, which the CFPB must implement and refine, to be finalized in January 2013. The Dodd-Frank Act also gave the CFPB the statutory authority to writing additional rules as needed.
The first set of CFPB’s proposed rules would require:
- Clear regular mortgage statements to include: a breakdown of payments by principal, interest, fees, and escrow; the amount of and due date of the next payment; recent transaction activity; and warnings about fees;
- Early disclosures before interest rate adjustments for most adjustable-rate mortgages;
- Options for avoiding “force-placed” insurance; and
- Early information and options for avoiding foreclosure.
- Promptly credited payments;
- Provide accurate and accessible documents and information;
- Quickly correcting errors; and
- Direct and ongoing access to servicer personnel to assist delinquent borrowers.
The CFPB will be accepting comments until October 9, 2012.
Read the proposed mortgage servicing rules here and here.
Read the CFPB’s summary of the proposals.
Read the CFPB’s factsheet.