Mon, Aug 28, 2017
The Mortgage Servicing Rules published by the Consumer Financial Protection Bureau (CFPB) are based on the provisions of the Dodd-Frank Wall Street Reform and Consumer Protection Act. The Dodd-Frank Wall Street Reform and Consumer Protection Act (the Dodd-Frank Act) amended the Real Estate Settlement Procedures Act (RESPA) of 1974, which is implemented by Regulation X, and the Truth in Lending Act (TILA), which is implemented by Regulation Z, with regard to the servicing of certain residential mortgage loans.
The Mortgage Servicing Rules apply to closed end consumer credit transactions that are secured by a dwelling and which the credit union services.
Small servicers are exempt from certain parts of the rule; however, if you service mortgage loans there are parts of the rule that apply to all servicers regardless of size. Your credit union qualifies as a small servicer if the credit union, together with any affiliates, service 5,000 or fewer mortgage loans and are the servicer for all of them.
If the credit union services any mortgage loan it (or an affiliate) did not originate or does not own, the credit union does not qualify as a small servicer, even if it services 5,000 or fewer loans overall.
Requirement for policies and procedures.
The credit union should establish policies and procedures designed to achieve the following objectives in regards to mortgage loan servicing:
- Accessing and providing timely and accurate information;
- Properly evaluating loss mitigation applications;
- Facilitating oversight of, and compliance by, service providers;
- Promptly facilitating transfer of information during servicing transfers;
- Informing members of the written error resolution and information request procedures; and
- Set standards for record retention and service file creation.
Effective on April 19, 2018, the credit union will also need to include the following within their policies and procedures:
- Promptly facilitating communication with potential and confirmed successors in interest and confirming a successor in interest’s identity and ownership interest.