After analyzing public feedback on pandemic-related forbearance programs and ways to automate and streamline long-term loss mitigation assistance, the Director of the Consumer Financial Protection Bureau (CFPB or Bureau), Rohit Chopra, issued a blogpost indicating the CFPB will be proposing ways to “simplify and streamline” mortgage servicing rules.
“Many commenters noted that borrowers seeking help on their mortgages can face a paperwork treadmill that hurts both homeowners and mortgage servicers. According to commenters, the temporary pandemic-related changes we made to the mortgage servicing rules helped alleviate this problem and get borrowers accommodations more quickly.” According to the CFPB, commenters also expressed concern over incurring servicing fees and negative credit reporting while waiting for mortgage servicers to review loss mitigation options.
Against the backdrop of these concerns, Director Chopra stated the CFPB will propose streamlining servicing rules “only if it would promote greater agility on the part of mortgage servicers in responding to future economic shocks while also continuing to ensure they meet their obligations for assisting borrowers promptly and fairly.” Director Chopra also stated that the Bureau continues to welcome petitions on potential amendments to the servicing rules. Stay tuned for additional developments on the servicing rules.