WASHINGTON—The CFPB’s mortgage servicing rules proposal would eliminate existing processes and system mortgage processors have used for years, inviting regulatory uncertainty and protections for bad actors, according to America’s Credit Unions.
The opinion was expressed by ACU’s Regulatory Advocacy Senior Counsel Amanda Smith in a letter sent to the Bureau in response to its proposed changes to mortgage servicing rules.
“The proposed changes would burden lenders with extended loss mitigation cycles, cause confusion regarding the beginning and end of those cycles, open lenders to risk due to lack of guidance, and arduous data collection and requirements regarding language requirements that are not appropriate for credit unions’ field of membership constraints,” Smith wrote.
Potential Conflicts Cited
She further stated the proposal does not align with NCUA guidance, could create conflict with state rules regarding foreclosure proceedings, and is too broad and ambiguous regarding which fees are prohibited.
America’s Credit Unions is requesting the CFPB exempt all credit unions from the language access requirements of this rule as “their field of membership requirement differentiates them from other financial institutions and makes application of these requirements inappropriate.