Mortgage servicers, your time is up. The 18 months that you have been given to adjust your operations in order to work with individuals who have been affected by the COVID-19 pandemic and “develop robust business continuity and remote work capabilities” are enough that state ad federal regulators have come together and announced that the “temporary flexibility” that they offered regarding their supervision and enforcement prerogatives are over.
The guidance, issued by the Consumer Financial Protection Bureau, Federal Deposit Insurance Corp., National Credit Union Administration, Office of the Comptroller of the Currency, and state financial regulators, officially ends the adjustments that were put into place in April 2020 and puts things back to the way they were before the pandemic started.
Effective November 10, mortgage servicers find themselves subject to the regulators’ “respective supervisory and enforcement authorities, where appropriate, to address any noncompliance or violations” that occur after that date.
“The agencies recognize the ongoing challenges faced by mortgage servicers and their efforts to assist customers and members affected by the ongoing COVID-19 pandemic,” the regulators wrote. “The agencies continue to encourage mortgage servicers to engage in these efforts. The agencies will consider, when appropriate, the specific impact of servicers’ challenges that arise due to the COVID-19 pandemic and take those issues in account when considering any supervisory and enforcement actions.”
Regulators will be keeping an eye on servicers to make sure they are still doing all they can to help homeowners.
“Failures by mortgage servicers and regulators worsened the impact of the economic crisis a decade ago,” said CFPB Director Rohit Chopra, in a statement. “Regulators have learned their lesson, and we will be scrutinizing servicers to ensure they are doing all they can to help homeowners and follow the law.”
The CFPB released a separate report detailing its work to avert another foreclosure crisis as a result of the COVID-19 pandemic.
