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CFPB to Expand on New Servicing Rules at Five Star Conference

CFPBThe Consumer Financial Protection Bureau (CFPB) is scheduled to host the Industry & Servicer Training Update at the Five Star Conference & Expo on September 12, 2016. The presentation will be among the first times that the Bureau will provide an in-depth, in-person training since the promulgation of the new servicing rules published on Thursday.

The update will be led by Laurie Maggiano, the Manager for Servicing and Securitization Markets in the Division of Research, Markets, and Regulation at the CFPB. Maggiano will address the 900-page finalized set of rules on mortgage servicing. These updated measures are designed to ensure that homeowners, struggling borrowers, and property heirs are treated fairly by mortgage servicers.

“We are proud to provide the CFPB with this platform for the benefit of the mortgage servicing industry,” said Ed Delgado, President & CEO of the Five Star Institute. “This update represents a special opportunity for the industry to actively engage with the Bureau and get their questions answered directly.”

The finalized rules dictate that servicers must provide certain borrowers with foreclosure protections more than once over the life of the loan. According to the CFPB, this change will be particularly helpful for borrowers who obtain a permanent loan modification and later suffer an unrelated hardship, such as the loss of a job or the death of a family member, that could otherwise cause them to face foreclosure.

Servicers must also clarify borrower protections when the servicing of a loan is transferred and provide important loan information to borrowers in bankruptcy.

The updated rules also more clearly define various roles in the foreclosure process. For those who inherit property, the potential foreclosure process has been especially perilous. The updated rules establish a broad definition of “successor in interest” that generally includes persons who receive property upon the death of a relative or joint tenant, via divorce or legal separation, through certain trusts, or from a spouse or parent and gives them, generally, the same protections outlined under the CFPB’s mortgage servicing rules as the original borrower.

These amendments also require servicers to notify borrowers when loss mitigation applications are complete and provide greater protection for struggling borrowers during servicing transfers. The rules also clarify servicers’ obligations to avoid dual-tracking and prevent wrongful foreclosures, as well as when a borrower becomes delinquent.

“When a borrower misses a periodic payment but later makes it up, if the servicer applies that payment to the oldest outstanding periodic payment, the date the borrower’s delinquency began advances,” the CFPB stated.

CFPB Director Richard Cordray said, “These updates to the rule will give greater protections to mortgage borrowers, particularly surviving family members and other successors in interest, who often are especially vulnerable.”

The finalized rules were released at a time when the CFPB is also considering a set of consumer protection principles to guide mortgage servicers, investors, government housing agencies, and policymakers as they develop new foreclosure relief solutions, now that the federal Home Affordable Modification Program (HAMP) is coming to its end.

The CFPB will give a more detailed analysis on these extensive updates during The Five Star Conference & Expo. The Five Star Conference is the nation’s largest gathering of mortgage servicing professionals, complete with industry leading academics, career-advancing networking opportunities, and special keynote presentations. The 2016 Five Star Conference & Expo takes place September 11 – 13 in Dallas, Texas.

Click here to register for The Five Star Conference and Expo.

The Five Star Institute is a parent company for MReport and themreport.com.

About Author: Scott Morgan

Scott Morgan is a multi-award-winning journalist and editor based out of Texas. During his 11 years as a newspaper journalist, he wrote more than 4,000 published pieces. He's been recognized for his work since 2001, and his creative writing continues to win acclaim from readers and fellow writers alike. He is also a creative writing teacher and the author of several books, from short fiction to written works about writing.
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