On May 11, 2020, the Consumer Financial Protection Bureau (CFPB) settled with a Colorado-based mortgage servicer that serviced a portfolio of mortgage loans worth approximately $112.69 billion. According to the CFPB, the Bureau found that the servicer violated the Real Estate Settlement Procedures Act (RESPA), 12 U.S.C. § 2601 et seq., and its implementing regulation, Regulation X, 12 C.F.R. part 1024, as well as the Consumer Financial Protection Act of 2010 (CFPA) by taking prohibited foreclosure actions against certain borrowers and failing to send or timely send evaluation notices to certain borrowers. The servicer did not admit or deny any of the CFPB’s allegations.
According to the consent order, since January 10, 2014, the servicer made First Filings, moved for foreclosure judgment or an order of sale, and conducted foreclosure sales in instances where the borrower was entitled to protection from these actions under Regulation X. The servicer also allegedly failed to send or timely send Evaluation Notices to certain borrowers who were entitled to Evaluation Notices under Regulation X.
Under the settlement, the servicer must pay $775,000 in restitution to affected consumers under a redress plan to be approved by the CFPB, a $250,000 civil money penalty to the CFPB, and is required to waive $500,000 in borrower deficiencies. The settlement further requires the servicer to implement certain policies and procedures to protect consumers from further violations of the RESPA and Regulation X. The servicer must also monitor its foreclosure activity to ensure compliance with the policies and procedures it implements.