The Conference of State Bank Supervisors and the American Association of Residential Mortgage Regulators issued a joint statement in support of the CFPB's Mortgage Servicing Transfer Bulletin. The CFPB's bulletin provided guidance to residential mortgage servicers and subservicers on the CFPB's expectations of servicers engaged in large servicing transfers (see February 19, 2013 Alert). The joint statement of the CSBS and AARMR commends the CFPB for identifying matters warranting particular supervisory attention and providing “clarity to the industry” on the CFPB's expectations for servicing transfers. The CSBS and AARMR have made similar findings of the potential for consumer harm resulting from transfers, such as transferee servicers failing to honor their predecessors' terms of trial modification due to relevant documents not being transferred or the transferee failing to take steps to identify mortgages subject to trial loan modifications. To mitigate the potential for consumer harm, CSBS and AARMR are encouraging state supervised servicers to familiarize themselves with state and federal requirements, and are expected to update state uniform servicing examination procedures to account for the new CFPB guidance.
The FHFA also released a statement in support of the CFPB’s bulletin citing its shared goal of improving servicing performance and the belief that it will result in better outcomes for both consumers and investors.