Consumer Financial Services Law Monitor

Consumer Financial Services Law Monitor

monitoring the financial services industry to help companies navigate through regulatory compliance, enforcement, and litigation issues

Maryia Y. Jones

Maryia Y. Jones

Blog Role:
Contributor – Mortgage Servicers & Lenders

CFS Value:
Maryia specializes in commercial litigation and consumer law in the financial services industry.

Subscribe to all posts by Maryia Y. Jones

House Financial Services Committee Hears Bill to Exempt Lawyers from FDCPA in Connection with Legal Proceedings and Related Communications

Posted in ALL CFS Blog Entries, Debt Buyers & Collectors
On September 7, the Financial Services Committee held hearings on a bill, H.R. 1849: Practice of Law Technical Clarification Act of 2017 (Trott), that seeks to amend the Fair Debt Collection Practices Act. The current definition of “debt collector” under the FDCPA does not make clear whether it applies to attorneys, especially in the context… Continue Reading

Seventh Circuit Holds That Debt Collector Cannot Avoid Liability Under FDCPA Despite Strict Compliance With Controlling Precedent

Posted in ALL CFS Blog Entries, Debt Buyers & Collectors, Mortgage Lenders & Servicers
In a surprising decision involving a vigorous and scathing dissent, the Seventh Circuit ruled that a debt collector was liable under the Fair Debt Collection Practices Act even when it followed the law that was in effect at the time the alleged violation took place.  This alarming ruling raises an obvious question:  Is compliance with… Continue Reading

Seventh Circuit Holds Rule 67 Tender of Full Relief Does Not Moot TCPA Class Action

Posted in ALL CFS Blog Entries, Debt Buyers & Collectors, Mortgage Lenders & Servicers
In Campbell-Ewald Co. v. Gomez, 136 S.Ct. 663 (2016), the Supreme Court held that an unaccepted offer of full relief under Rule 68 to a named plaintiff was insufficient to moot class claims.  However, the Supreme Court expressly left open the possibility of a “different result if a defendant deposits the full amount of the… Continue Reading

Supreme Court Refuses to Extend the Scope of the FDCPA to Consumer Finance Company

Posted in ALL CFS Blog Entries, Debt Buyers & Collectors, Featured Posts
On June 12, 2017, the United States Supreme Court rendered a unanimous decision holding that a company collecting debts that it purchased for its own account does not meet the statutory definition of “debt collector” under the Fair Debt Collection Practices Act (FDCPA) because the debts are no longer “owed or due another.” We previously… Continue Reading

CFPB Files Suit Against Four Online Lenders Operated by Native American Tribe

Posted in ALL CFS Blog Entries, Featured Posts, State Attorneys General, CFPB, & FTC
On April 27, the Consumer Financial Protection Bureau filed a lawsuit in an Illinois federal court against four online installment loan companies operated by a California Native American tribe.  Although the tribe operates the installment loan companies, the CFPB’s complaint alleges that the defendants are not “arms of the tribe” and therefore should not be… Continue Reading

Supreme Court Wavers During Oral Arguments in FDCPA Case That May Upend Entire Industry

Posted in ALL CFS Blog Entries, Auto Finance, Debt Buyers & Collectors, Featured Posts
On April 18, the United States Supreme Court heard long-awaited oral arguments in a case that addresses the fundamental issue of the definition of a “debt collector” under the Fair Debt Collection Practices Act.  The Supreme Court’s decision will resolve an existing Circuit split on whether an entity that purchases defaulted debts and then attempts… Continue Reading

New York Federal Court Dismisses FDCPA Class Claims in a Letter Case

Posted in ALL CFS Blog Entries, Debt Buyers & Collectors
On July 7, the U.S. District Court for the Eastern District of New York granted a debt collector’s motion to dismiss a plaintiff’s claims brought on a class basis under the Fair Debt Collection Practices Act (“FDCPA”). The case arose out of a debt collection letter that listed state-required disclosures, including a section headed “ADDITIONAL… Continue Reading

California Federal Court Joins Others in Staying Putative FCRA Class Action Pending Spokeo Decision

Posted in ALL CFS Blog Entries, Credit Reporting & Data Brokers
Judge Beth Labson Freeman for the United States District Court for the Northern District of California recently joined numerous other courts across the country in staying a putative FCRA class action pending the outcome of the Supreme Court’s decision in Spokeo Inc. v. Robins. The underlying action in the California court challenged the defendant’s alleged… Continue Reading

CFPB Releases TRID Guidance for Construction Loans

Posted in ALL CFS Blog Entries, Mortgage Lenders & Servicers
The CFPB released a resource intended to help lenders understand and implement the TILA-RESPA integrated disclosures (“TRID”) when extending construction loans.     The CFPB’s factsheet provides that construction loans are subject to TRID requirements as long as they are closed-end consumer credit transactions secured by real property.  The only exception is those construction loans that are… Continue Reading

Federal Court Holds Letter Under Servicemembers Civil Relief Act Not Subject to FDCPA

Posted in ALL CFS Blog Entries, Mortgage Lenders & Servicers
On December 17, in addressing an issue of first impression, the United States District Court for the Eastern District of Pennsylvania held that a letter sent by a loan servicer under the Servicemembers Civil Relief Act (“SCRA”) to a borrower in default was not subject to the Fair Debt Collection Practices Act (“FDCPA”).  Accordingly, the Court dismissed the borrower’s putative class… Continue Reading

Illinois Supreme Court Expands the Definition of “Consumer” Under TILA for Purposes of Right to Rescind

Posted in ALL CFS Blog Entries, Mortgage Lenders & Servicers
On September 24, the Illinois Supreme Court reversed trial and appellate courts’ decisions and held that land trusts are considered “consumers” for purposes of exercising a right to rescind the loan transaction under the federal Truth in Lending Act (TILA). At issue in this case was a reverse mortgage transaction in which the borrower was… Continue Reading

Florida Court Holds Substantial Compliance Is Sufficient for 30-Day Notice of Default

Posted in ALL CFS Blog Entries, Mortgage Lenders & Servicers, State Attorneys General, CFPB, & FTC
A Florida state court has weighed in on whether strict or substantial compliance is required when providing borrowers with a notice of default. In Green Tree Servicing, LLC v. Erin C. Milam et al., the Court has agreed with decisions from other states that a lender’s notice of default is sufficient when it substantially complies… Continue Reading

Third Circuit Adopts Materiality Requirement under the FDCPA

Posted in ALL CFS Blog Entries, Mortgage Lenders & Servicers, State Attorneys General, CFPB, & FTC
On June 30, the Third Circuit Court of Appeals joined a number of federal judicial circuits in holding that immaterial misstatements do not violate the Fair Debt Collection Practices Act (FDCPA). In this case, Plaintiff defaulted on her loan, and Defendant – a debt collector – obtained a default judgment against her.  Defendant then attempted… Continue Reading

CFPB Proposes to Postpone Effective Date of TILA-RESPA Integrated Disclosure Rule to October 3

Posted in Mortgage Lenders & Servicers, State Attorneys General, CFPB, & FTC
We previously reported on the remarks made by Consumer Financial Protection Bureau Director Richard Cordray on May 12 that the CFPB would not voluntarily change the August 1 effective date for the TILA-RESPA Integrated Disclosure Rule (TRID).  This officially changed on June 24 with the CFPB’s issuance of a proposed amendment to TRID, postponing its… Continue Reading

Supreme Court Grants Petition to Potentially Decide Whether a Rule 68 Offer of Judgment for Complete Relief Moots Potential Class Claims

Posted in ALL CFS Blog Entries, Debt Buyers & Collectors, Payment Processing & Cards, State Attorneys General, CFPB, & FTC
The U.S. Supreme Court agreed on May 18 to hear an appeal from the U.S. Navy’s advertising partner challenging the Ninth Circuit’s remand of a potential class action over allegedly unsolicited text messages, potentially resolving the issue of whether a putative class claim is mooted by an offer of complete relief under Rule 68 of… Continue Reading

The Seventh Circuit Refuses to Reconsider Its Ruling that Mortgage Servicers Must Credit Electronic Payments before Funds Are Received

Posted in Mortgage Lenders & Servicers, State Attorneys General, CFPB, & FTC
The Seventh Circuit has refused to reconsider its troublesome ruling that mortgage servicers violate the Federal Truth in Lending Act (TILA) if they do not credit electronic payments the day they are made even though the funds are not received until several days later. The TILA requires that payments be posted as of the “date… Continue Reading

Freddie Mac Will Require Re-Modifications of Previously Modified Loans

Posted in Mortgage Lenders & Servicers, State Attorneys General, CFPB, & FTC
On March 17, 2015, Freddie Mac issued an update to its Single-Family Seller/Servicer Guide (“Guide”) requiring servicers to offer additional modifications on previously modified step-rate mortgages.  This requirement will take effect July 1, 2015. By requiring loan re-modifications, Freddie Mac is seeking to address what has been on everyone’s mind for a while—the expiring HAMP… Continue Reading

Maryland Seeks to Adopt Heightened Mortgage Servicing Transfer Regulations

Posted in ALL CFS Blog Entries, Mortgage Lenders & Servicers, State Attorneys General, CFPB, & FTC
Through March 2, 2015, the State of Maryland is accepting comments on its proposed regulations of mortgage servicing transfers that include over 5,000 mortgages, whether as a single transfer or as a total at the end of a calendar year even if no single transfer was for 5,000 or more loans.  Although many of the… Continue Reading

CFS Bloggers Present on TILA Loan Originator Compensation Rule

Posted in ALL CFS Blog Entries, CFS Events, Mortgage Lenders & Servicers, State Attorneys General, CFPB, & FTC
At the invitation of Thompson Reuters Legal Insights and Analytics, attorneys Maryia Jones, Jason Manning, and Paige Fitzgerald delivered a presentation on TILA’s loan originator compensation rule (the “Rule”), which remains one of the CFPB’s enforcement priorities and a focus of plaintiffs’ bar in private lawsuits.  The presentation was delivered to an audience of mortgage… Continue Reading

CFPB Introduces Mortgage Interest ‘Rate Checker’ Tool

Posted in ALL CFS Blog Entries, Mortgage Lenders & Servicers, State Attorneys General, CFPB, & FTC
On January 13, 2015, the Consumer Financial Protection Bureau (CFPB) released a report on consumers’ mortgage shopping experiences.  The CFPB found that almost half of consumers who take out a mortgage fail to shop prior to application and that consumers seriously consider only a single lender or mortgage broker before choosing where to apply.  The… Continue Reading

Freddie Mac Auctioning $410 Million of Delinquent Mortgages as Market for Such Mortgages Is Heating Up and Prices Are Surging

Posted in ALL CFS Blog Entries, Debt Buyers & Collectors, Mortgage Lenders & Servicers, State Attorneys General, CFPB, & FTC
Freddie Mac is selling three pools of deeply delinquent loans with the combined unpaid principal balance of $410 million.  According to Freddie Mac’s spokesman, the loans involved in the sale include “a large share that are more than two years delinquent,” which is consistent with Freddie Mac’s “continued goal of reducing illiquid assets from its… Continue Reading

Rescue Scammers Stall Foreclosures by Filing False Documents to Cloud Title

Posted in ALL CFS Blog Entries, Mortgage Lenders & Servicers, State Attorneys General, CFPB, & FTC
In recent years, the industry has seen various types of foreclosure rescue fraud perpetrated against borrowers, lenders, and servicers.  One example is a California-based scam that caused losses of more than $2.5 million whereby the scam’s orchestrators recorded fraudulent documents in local courthouses in an effort to “cloud title” and halt or stall the foreclosure… Continue Reading

FHFA Issues Advisory Bulletin to Improve Fannie and Freddie Oversight of Non-Bank Mortgage Servicers

Posted in ALL CFS Blog Entries, Mortgage Lenders & Servicers, State Attorneys General, CFPB, & FTC
We have previously reported on the Federal Housing Finance Agency’s concern that the recent explosive growth of nonbank specialty mortgage servicers may pose operational and liquidity risks to such servicers and put in jeopardy Fannie Mae and Freddie Mac (collectively, the Enterprises) that guarantee these mortgages.  In particular, FHFA concluded that the nonbank servicers’ use… Continue Reading

CFPB Charges Yet Another Mortgage Lender With Violations of the Loan Originator Compensation Rule

Posted in ALL CFS Blog Entries, Mortgage Lenders & Servicers, State Attorneys General, CFPB, & FTC
On November 13, the Consumer Financial Protection Bureau ordered a California mortgage lender to pay $730,000 for allegedly paying its loan originators compensation based on loan terms.  The CFPB has asked the United States District Court for the Central District of California to approve a consent order requiring the company to end its allegedly illegal… Continue Reading