AFR in the News: Consumer Groups Ask CFPB to Scrap Mortgage Rules as Inadequate

In an Oct. 9th letter to the CFPB, AFR criticized the bureau’s proposed rule for mortgage servicers, especially a provision allowing servicers to take a “dual-track” approach – considering a loan modification and pursuing foreclosure at the same time.

The letter, co-signed by the NAACP, the Consumer Federation of America, Consumers Union, the AFL-CIO, and The Leadership Conference on Civil and Human Rights among other groups, praises the draft rule for guaranteeing “continuity of contact” with “dedicated” loan personnel. But, as Bloomberg’s Carter Dougherty reports, the co-signers want the CFPB to insist on more practical help for borrowers seeking to avoid foreclosure.

The joint letter, Dougherty writes, asks the Bureau to start over with a new proposal “if that is necessary in order to make the major changes required.”

Servicers should be required to “take specific, enforceable steps to evaluate homeowners for affordable and sustainable loan modifications,” the article goes on to quote Margot Saunders of the National Consumer Law Center as saying.

The CFPB plans to issue final rules in January.