Members of the Americans for Financial Reform coalition have argued that all homeowners should enjoy the same basic protections in their dealings with mortgage loan servicers. On November 20, the CFPB announced a set of proposed new rules that would bring that goal closer to reality for heirs, surviving spouses, and homeowners going through divorce. The proposal also would put in place important new protections for homeowners who encounter new hardships after a first loan modification. And it should help homeowners get loan modifications and avoid foreclosure after their loans have been transferred from one company to another.
In our detailed response to the proposal, we expect to urge the CFPB to take further steps to make sure that homeowners who are not fluent English speakers are treated fairly, and to require loan servicers to be clearer about the documents a homeowner needs to submit in order to be considered for a loan modification, so that applicants are not left hanging while servicers make repeated requests for additional paperwork.