U.S. Banking Regulators Order Changes to Policies and Practices of Major Mortgage Servicers
On April 13, the Federal Reserve and the OCC announced enforcement actions against the nation’s largest mortgage servicers. The enforcement actions follow an interagency review that identified weaknesses in a variety of areas of mortgage servicers’ operations and practices. An interagency report found that significant improvements need to be made with regard to, among other things, foreclosure process governance, risk management, oversight of third party vendor relationships and communications with borrowers. The enforcement actions come at a time when the leading mortgage servicers are engaged in settlement negotiations with the 50 state attorneys general and as the federal banking and housing regulators continue to develop nationwide mortgage-servicing and foreclosure processing standards.