The Consumer Financial Protection Bureau (CFPB) proposed new rules on July 10, 2024 that would obligate large mortgage servicers to help homeowners/borrowers avoid foreclosure, expand access to borrowers seeking mortgage payment assistance, and strengthen communication between borrowers and servicers.
These rules would mandate servicers to do everything they can to provide payment assistance to borrowers before they can seek foreclosure while also speeding up servicers’ evaluations of borrowers’ eligibility for assistance by greenlighting such reviews once borrowers provide some documentation rather than requiring the submission of a complete application.
Further, the amendments would mandate prompt status updates on borrowers’ applications and require servicers to broadly construe what qualifies as a request for assistance.
The new provisions would also obligate servicers to communicate with borrowers in their preferred language in certain circumstances as well as to include guidance about how to obtain information about payment assistance in notices sent after missed payments.
