The Consumer Financial Protection Bureau (CFPB) proposed on Thursday an additional set of measures designed to expand foreclosure protections for mortgage borrowers.
In an announcement Thursday afternoon, CFPB detailed the latest additions to its mortgage servicing rules, which first went into effect earlier this year. Since that time, the bureau says it has continued to engage in outreach with consumer advocacy groups, industry representatives, and other stakeholders to develop additional provisions to protect consumers and make it easier for companies to comply with the rules.
“The Consumer Bureau is committed to ensuring that homeowners and struggling borrowers are treated fairly by mortgage servicers and that no one is wrongly foreclosed upon,” CFPB Director Richard Cordray said in a statement. “Today’s proposal would give greater protections to mortgage borrowers.”
Chief among the proposed rules would be a requirement that servicers must provide additional foreclosure protections to borrowers who have already worked through the loss mitigation process previously and recovered.
Under the current rules, servicers are already required to provide certain protections, including the right to be evaluated under CFPB requirements for foreclosure avoidance options, once during the life of the mortgage.
The proposed rule would require servicers to offer those same protections again for borrowers who have brought their loans current at any time since the last loss mitigation application. The bureau says the rule is largely designed to protect those who obtain a permanent loan modification and then later suffer an unrelated hardship that could create additional struggles, such as a job loss or the death of a family member.
This is a developing story. Check back later for more details.