The Consumer Financial Protection Bureau released a set of new rules Thursday that detail additional requirements for mortgage servicing. Like the QM rule, the new servicing rules will be effective Jan. 10, 2014.
The new servicing rules are harsher than a proposal issued last year.
The agency's goal is to fix a "broken system," according to CFPB Director Richard Cordray. The rules set specific timetables and restrictions on when a servicer can foreclose on a borrower, including forcing them to wait at least four months after a loan is delinquent before even initiating a foreclosure proceeding.
"We will exercise our supervision and enforcement authority to make these rules stick for mortgage servicers across the entire market," said Cordray on Thursday, according to prepared remarks. "By working to see that homeowners are treated with dignity once again, we are taking a big step forward for progress and fairness in this country."
American Banker's Rachel Witkowski and Kate Berry provide a guide to the complex provisions for the new servicing rules.
For the full piece see "Cheat Sheet: A Detailed Look at CFPB's Tough New Servicing Rules" (No subscription required.)