Mortgage Servicers Should Prepare To Be In CFPB Crosshairs

– Law360

Consumer financial services practice Leader Richard Gottlieb and Manatt Financial Services Partner Brett Natarelli and Counsel Joseph Reilly authored an article for Law360 on what to expect on the enforcement front from the Biden Administration’s Consumer Protection Financial Bureau (CFPB). The authors noted that while things may look relatively quiet right now, mortgage servicers who remember the CFPB's early days following the 2008 foreclosure crisis have a different view: What we are seeing now has all the hallmarks of the calm before a huge storm. They went on to explain that as it relates to mortgages, the CFPB enforcement actions we see today are primarily the product of investigations commenced before the new administration. “But the dynamic has plainly changed, and the bureau has launched several warning volleys,” the authors noted. “On March 31, the CFPB issued Bulletin No. 2021-02, aptly named ‘Supervision and Enforcement Priorities Regarding Housing Insecurity,’ warning servicers to: dedicate sufficient resources and staff to ensure they can communicate clearly with borrowers, effectively manage borrower requests for assistance, promote loss mitigation, and ultimately reduce avoidable foreclosures and foreclosure-related costs.”

Law360 subscribers can read the full article here.

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