By John C. Lynch, David N. Anthon, Jason E. Manning, and Maryia Y. Jones
On February 11, 2013, the Consumer Financial Protection Bureau (CFPB) issued a bulletin (Bulletin) detailing its plans to closely supervise loan servicing transfers and enforce federal and state law compliance in connection with such transfers. The backdrop for this new initiative is the CFPB's concern that transferee servicers frequently fail to honor the terms of trial loan modifications provided by predecessor servicers. This may happen because relevant documents are not transferred to the transferee servicer or the transferee servicer does not take adequate steps to identify mortgages subject to trial loan modifications.
The CFPB's focus areas include:
A copy of the Bulletin is located here. Loan servicing transfers policies and procedures are impacted by the Real Estate Settlement Procedures Act (RESPA), the Fair Credit Reporting Act (FCRA), and the Fair Debt Collection Practices Act (FDCPA), as well as state-specific requirements.
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Please do not hesitate to contact David Anthony, John Lynch, Jason Manning, or Maryia Jones if you have questions or would like additional information on the CFPB's Bulletin.
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