In April 2012, the federal government’s Consumer Financial Protection Bureau (CFPB) announced that it was considering new rules to increase transparency and accountability in the mortgage servicing industry.
If the proposed rules become final rules, mortgage services would be required to:
- Warn homeowners before any interest rate adjustments.
- Redesign mortgage statements to clearly list fees.
- Provide options other than foreclosure to borrowers who are behind on their mortgage payments and work in good faith with delinquent borrowers to resolve the matter.
- Investigate reported errors within 30 days. This would include complaints that a mortgage servicer is moving to foreclosure while a borrower is in loan modification.
- Improve accessibility of staff for consumers.
These rules would apply to mortgage servicers who do business in Minnesota and across the nation.
This is not the first time that a government agency has sought to impose rules on mortgage servicers. However, mortgage servicers are diverse and range from the nation’s largest banks to small, independent contractors, and comprehensive rules have been hard to develop. The CFPB is thought to be the first agency with the authority to impose rules on all mortgage servicers.
The CFPB is seeking comments from the public before it formally proposes the rules. The rules are expected to be formally proposed this summer. Currently, the agency expects to have the rules finalized sometime in 2013.
Our Minnesota debt relief lawyers hope that the CFPB rules provide fair information and options for Minnesota homeowners and more Minnesotans work out agreements with their mortgage service providers so that they can stay in their homes.