Showing posts with label CONSUMER RIGHTS. Show all posts

Thursday, August 4, 2016

Consumer Financial Protection Bureau Expands Foreclosure Protections

Updated Servicing Rule Provides Surviving Family Members and Other Homeowners with Same Protections as Original Borrowers

AUG 04, 2016

Washington, D.C. – The Consumer Financial Protection Bureau (CFPB) today finalized new measures to ensure that homeowners and struggling borrowers are treated fairly by mortgage servicers. The updated rule requires servicers to provide certain borrowers with foreclosure protections more than once over the life of the loan, clarifies borrower protections when the servicing of a loan is transferred, and provides important loan information to borrowers in bankruptcy. The changes also help ensure that surviving family members and others who inherit or receive property generally have the same protections under the CFPB’s mortgage servicing rules as the original borrower.

“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,” said CFPB Director Richard Cordray. “These updates to the rule will give greater protections to mortgage borrowers, particularly surviving family members and other successors in interest, who often are especially vulnerable.”

Mortgage servicers are responsible for collecting payments from the mortgage borrower and forwarding those payments to the owner of the loan. They typically handle customer service, collections, loan modifications, and foreclosures. To address widespread mortgage servicing problems, the CFPB established common-sense rules for servicers that went into effect on January 10, 2014.

The CFPB issued proposed amendments to those rules in November 2014, and the final rule issued today adopts many of the proposed provisions. However, the Bureau made a number of changes in the final rule after considering comments received from the public.

The rule issued today establishes new protections for consumers, including:

Requiring servicers to provide certain borrowers with foreclosure protections more than once over the life of the loan: Under the CFPB’s existing rules, a mortgage servicer must give borrowers certain foreclosure protections, including the right to be evaluated under the CFPB’s requirements for options to avoid foreclosure, only once during the life of the loan. Today’s final rule will require that servicers give those protections again for borrowers who have brought their loans current at any time since submitting the prior complete loss mitigation application. This change will be particularly helpful for borrowers who obtain a permanent loan modification and later suffer an unrelated hardship – such as the loss of a job or the death of a family member – that could otherwise cause them to face foreclosure.
Expanding consumer protections to surviving family members and other homeowners: If a borrower dies, existing CFPB rules require that servicers have policies and procedures in place to promptly identify and communicate with family members, heirs, or other parties, known as “successors in interest,” who have a legal interest in the home. Today’s final rule establishes a broad definition of successor in interest that generally includes persons who receive property upon the death of a relative or joint tenant; as a result of a divorce or legal separation; through certain trusts; or from a spouse or parent. The final rule ensures that those confirmed as successors in interest will generally receive the same protections under the CFPB’s mortgage servicing rules as the original borrower.
Providing more information to borrowers in bankruptcy: Under the CFPB’s existing mortgage rules, servicers do not have to provide periodic statements or early intervention loss mitigation information to borrowers in bankruptcy. Today’s final rule generally requires, subject to certain exemptions, that servicers provide those borrowers periodic statements with specific information tailored for bankruptcy, as well as a modified written early intervention notice to let those borrowers know about loss mitigation options. Servicers also currently do not have to provide early intervention loss mitigation information to borrowers who have told the servicer to stop contacting them under the Fair Debt Collection Practices Act. Today’s final rule generally requires servicers to provide modified written early intervention notices to let those borrowers also know about loss mitigation options.
Requiring servicers to notify borrowers when loss mitigation applications are complete: Whether a borrower is entitled to key foreclosure protections depends in part on the date a borrower completes a loss mitigation application. If consumers do not know the status of their application, they cannot know the status of those foreclosure protections. Today’s final rule requires servicers to notify borrowers promptly and in writing that the application is complete, so that borrowers know the status of the application and have more information about their protections.
Protecting struggling borrowers during servicing transfers: When mortgages are transferred from one servicer to another, borrowers who had applied to the prior servicer for loss mitigation may not know where they stand with the new servicer. Today’s final rule clarifies that generally the new servicer must comply with the loss mitigation requirements within the same timeframes that applied to the transferor servicer, but provides limited extensions to these timeframes under certain circumstances. If a borrower submits an application shortly before transfer, the new servicer must send an acknowledgment notice within 10 business days of the transfer date. If the borrower’s application was complete prior to transfer, the new servicer must evaluate it within 30 days of the transfer date. If the new servicer needs more information to evaluate the application, the borrower would retain some foreclosure protections in the meantime. If the borrower submits an appeal, the new servicer has 30 days to make a determination on the appeal.
Clarifying servicers’ obligations to avoid dual-tracking and prevent wrongful foreclosures: The CFPB’s existing rules prohibit servicers from taking certain actions in foreclosure once they receive a complete loss mitigation application from a borrower more than 37 days prior to a scheduled sale. However, in some cases, borrowers are not receiving this protection, and servicers’ foreclosure counsel may not be taking adequate steps to delay foreclosure proceedings or sales. The CFPB’s new rule clarifies that, if a servicer has already made the first foreclosure notice or filing and receives a timely complete application, servicers and their foreclosure counsel must not move for a foreclosure judgment or order of sale, or conduct a foreclosure sale, even if a third party conducts the sale proceedings, unless the borrower’s loss mitigation application is properly denied, withdrawn, or the borrower fails to perform on a loss mitigation agreement. The clarifications will aid servicers in complying with, and assist courts in applying, the dual-tracking prohibitions in foreclosure proceedings to prevent wrongful foreclosures.
Clarifying when a borrower becomes delinquent: Several of the consumer protections under the CFPB’s existing rules depend upon how long a consumer has been delinquent on a mortgage. Today’s final rule clarifies that delinquency, for purposes of the servicing rules, begins on the date a borrower’s periodic payment becomes due and unpaid. When a borrower misses a periodic payment but later makes it up, if the servicer applies that payment to the oldest outstanding periodic payment, the date the borrower’s delinquency began advances. The final rule also allows servicers the discretion, under certain circumstances, to consider a borrower as having made a timely payment even if the borrower’s payment falls short of a full periodic payment. The increased clarity will help ensure borrowers are treated uniformly and fairly.

Today’s final rule makes additional changes to the CFPB’s mortgage servicing rules. These changes include providing flexibility for servicers to comply with certain force-placed insurance and periodic statement disclosure requirements. The changes also clarify several requirements regarding early intervention, loss mitigation, information requests, and prompt crediting of payments, as well as the small servicer exemption. Further, the changes exempt servicers from providing periodic statements under certain circumstances when the servicer has charged off the mortgage. Finally, concurrently with the final rule, the CFPB is issuing an interpretive rule under the Fair Debt Collection Practices Act relating to servicers’ compliance with certain mortgage servicing provisions as amended by the final rule.

Most of the provisions of the final rule will take effect 12 months after publication in the Federal Register. The provisions relating to successors in interest and the provisions relating to periodic statements for borrowers in bankruptcy will take effect 18 months after publication in the Federal Register.

View final rule

View interpretive final rule

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The Consumer Financial Protection Bureau is a 21st century agency that helps consumer finance markets work by making rules more effective, by consistently and fairly enforcing those rules, and by empowering consumers to take more control over their economic lives. For more information, visit www.consumerfinance.gov.

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Please contact us if you need help or resources as we are here and happy to help!
Respectfully,
Dana Shafman
Managing Member
END Consulting
(888) 234-7006 Ext 101
Dana@ConsultingEND.com
www.TheDailyComplaint.com

Tuesday, May 10, 2016

Why HAMP and HARP Have Run Their Course

Why HAMP and HARP Have Run Their Course | Carrington Real Estate – News

http://real-estate-news.bagr.com/2016/05/09/why-hamp-and-harp-have-run-their-course/

“HAMP was developed to address a crisis and we’re really not in a crisis,” said Eric Selk, executive director of the Hope Now Alliance.

The Obama administration’s Making Home Affordable program has been extended and expanded so many times that it’s gotten hard to imagine life without it. But the days may be numbered for MHA and its two primary initiatives, the Home Affordable Modification Program and Home Affordable Refinance Program.

As the housing market’s recovery continues to solidify, the number of underwater borrowers that MHA was designed to help has receded, not to mention the fact that a new administration will occupy the White House following the upcoming elections.

In one sense, the scheduled Dec. 31 end date of Making Home Affordable is a nonevent because nationally, the volume of loans flowing through HAMP and HARP has slowed considerably. But the programs are still a force to be reckoned with. The refinance program’s volume has been significant in the past and remains so in certain regions. And there’s no denying that the modification program, while small in size now, has had a huge influence over the way loss mitigation is handled in the market.

“MHA has left a lasting impact on the industry,” said Mark McArdle, deputy assistant secretary of the Treasury Department’s Office of Financial Stability. “Previously, modifications were typically about kicking the can down the road and ultimately did not reduce payments. HAMP has introduced a standardized loss mitigation waterfall as a common expectation. The question is, when we go away, how much of that will remain?”

The Federal Housing Finance Agency is weighing options for a refinance program to succeed HARP, but any plan would be limited to loans purchased by its primary charges, Fannie Mae and Freddie Mac. And it’s so far been silent on any plans for a new modification program to take HAMP’s place.

But HAMP’s influence will continue long after servicers stop taking requests for new workouts. The runoff of previously modified loans will last for years, while other forms of loss mitigation will continue to incorporate procedures that were rare, or even nonexistent, prior to its existence — not to mention how history will view Making Home Affordable’s legacy in the broader context of the Great Recession.

“What the expiration of this means will be a matter of how you view economics,” said Les Parker, an industry veteran and contributing writer to The Mortgage Professional’s Handbook, a guidebook on the inner-workings and history of the mortgage industry published earlier this year. “It is government intervention, and the questions people will look at is, was that government intervention good or bad?”

With that in mind, let’s take a look at what the mortgage industry might look like once HAMP and HARP have come to an end.

A Political Question

Both Republican and Democratic presidents have shown a willingness to let government intervene in the mortgage markets in the past. It’s unclear where the current slate of presidential candidates stand on the issue, but generally, Parker said, “I think the odds are Making Home Affordable is not going to be extended if a Republican is coming in.”

Some Republicans and investors, as well as the special inspector general for the Troubled Asset Relief Program that funds MHA, have been critical of HAMP’s redefault rate or the program’s inability to reach more borrowers. Critics also have showed concern about the potential moral hazard it presents in lowering delinquent borrowers payments in standardized ways that don’t account more granularly for individuals’ merits, while leaving performing borrowers’ unchanged, Parker noted.

Certain Democrats as well as the Treasury, the FHFA and other proponents have meanwhile defended the program. They note that the majority of HAMP loans remain current after modification, that the program was structured to minimize moral hazard and that performance improved over time, with the latest iterations proving generally more effective than proprietary modifications.
That debate will resurface in any contemplation of an extension or successor program to HAMP. But because the next president will take office shortly after MHA’s scheduled expiration, it’s unlikely there will be any change from the current plan to let it sunset, unless it is a simple extension. However, an extension remains a long shot because of the widespread perception that the program was created to respond to a crisis that no longer exists.

“I think it will sunset because how do you justify that there is still a problem?” Parker said.
Ultimately, HAMP could become the model for what some are calling a “mod on a shelf,” which could be revived in the event of a future housing crisis, said Eric Selk, the executive director of Hope Now.

“HAMP was developed to address a crisis and we’re really not in a crisis,” he said.
While the end of Making Home Affordable may serve as fodder for political rhetoric in debates about housing policy, market conditions are generally far better than they were during the crisis, said David Lykken, president and founder of Transformational Mortgage Solutions, a consulting firm in Austin, Texas.

“It’s important to realize as we go into this election cycle that there could be a lot of talk about how the end of Making Home Affordable could destroy homeownership to suggest that we need the programs,” he said.

But delinquencies have returned to normalized levels, noted Lynn Fisher, a vice president of research and economics at the Mortgage Bankers Association. And even though negative equity levels aren’t back to normal, they are far closer to it.
The percentage of underwater homes among people with a mortgage is less than 10%, as opposed to a rate more than twice that during the crisis, according to CoreLogic chief economist Frank Nothaft.

“You would normally expect to see negative equity closer to 2% to 3%. We’re at most two to three years from normality,” Nothaft said.

Overall, the number of underwater homeowners with a GSE loan has dropped by more than 80% since its peak at the end of 2011, and the vast majority of the remaining underwater borrowers are current on their mortgages, according to FHFA Director Mel Watt. About 9% are still seriously delinquent.

While borrower distress associated with crisis-era underwater homes is less of a problem on average, it remains a challenge in certain concentrated regions. So the expiration of a modification program specifically designed to help these borrowers will put some stress on these regions and entities that hold concentrations of loans there.

States with longer foreclosure timelines such as New York, New Jersey and Florida are more likely to feel some impact from HAMP’s expiration, said Michael Fratantoni, the MBA’s chief economist.
And some regions that still lag in home price recovery will be affected more than others when MHA’s refinance program ends. These include Las Vegas, the Inland Empire in California, and parts of Florida, Fratantoni added.

HARP Will Be Replaced

While it was less groundbreaking than HAMP and received the benefit of a number of refinements over time, the Home Affordable Refinance Program didn’t have as tough of a row to hoe.
“HARP was an amazingly successful program,” said Fratantoni. “I think HAMP had some more hurdles to get over.”

And unlike HAMP, there are immediate plans for a GSE successor to HARP.

“As HARP winds down, we are also working to make sure that borrowers with high loan-to-value ratio loans have a refinance option in the future,” Watt said in in a policy speech in March, noting that it “will be important in the event there are regional or localized economic disruptions that lead to negative equity.” However, borrowers who previously participated in HARP would not be eligible to refinance under the new program.

The GSEs have helped more than 3.3 million homeowners refinance their mortgages through HARP, saving them on average $2,200 a year in reduced mortgage payments.

HARP loans accounted for as much as 40% of Fannie Mae and Freddie Mac refinance volume at the program’s height in May 2012, according to Black Knight Financial Services estimates. However, that was an unusual month, and the percentage has fallen drastically over time. While it continues to aggressively target remaining eligible borrowers, the FHFA found HARP accounted for only about 5% of GSE refinances during January 2016 and quarterly averages were no higher than around 27% at the market’s peak.

So what kind of program could succeed HARP at Fannie and Freddie?

One possibility is a Fannie Mae loan modeled off of the Department of Veterans Affairs’ streamline refinance program, said Brent Nyitray, director of capital markets at iServe Residential Lending in Stamford, Conn.

“That’s one thing the government could easily do if they wanted to permanently extend HARP,” he said.

Among other things, the Department of Veterans Affairs does not require an appraisal on its streamline refinances, which would help underwater borrowers overcome any loan-to-value eligibility restrictions.

“The question will be will lenders want to do that? Because there are fears of having the loan put back to you by Fannie Mae,” Nyitray said.

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Please contact us if you need help or resources as we are here and happy to help!
Respectfully,
Dana Shafman
Managing Member
END Consulting
(888) 234-7006 Ext 101
Dana@ConsultingEND.com
www.TheDailyComplaint.com

Friday, March 4, 2016

Oversight of the National Mortgage Settlement Is Done, Monitor Says

By Kate Berry
March 3, 2016

ARTICLE LINK (CLICK HERE)

Oversight of the four largest mortgage servicers' compliance with the national mortgage settlement is officially over, the watchdog overseeing the process said Thursday.

Bank of America, Citigroup, JPMorgan Chase and Wells Fargo met all requirements of the settlement's servicing standards at the end of the third quarter, said Joseph A. Smith, the settlement's monitor.

"The settlement has improved the way these servicers treat distressed borrowers," Smith said in a press release.

Smith filed his final compliance reports Thursday with the U.S. District Court for the District of Columbia for the four banks, officially marking the sunset of rules for the $25 billion settlement. The servicers signed the settlement in March 2012 with federal regulators and 49 state attorneys general after the discovery of widespread "robo-signing" of foreclosure documents.

The final monitoring on Ocwen Financial and Ditech Financial, formerly Green Tree Servicing, will be filed later this year, Smith said. Those two servicers had taken over the assets of Residential Capital from Ally Financial, the fifth servicer that signed the 2012 settlement.

The servicers still remain accountable to servicing rules enforced by the Consumer Financial Protection Bureau.

The banks initially paid $5 billion in fines though Smith said they ultimately gave distressed borrowers $50 billion in debt forgiveness, loan modifications, short sale assistance and refinancing.

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Please contact us if you need help or resources as we are here and happy to help!
Respectfully,
Dana Shafman
Managing Member
END Consulting
(888) 234-7006 Ext 101
Dana@ConsultingEND.com
www.TheDailyComplaint.com

Monday, September 14, 2015

Tick-tock goes the clock on old debts

September 10, 2015

by Cristina Miranda

Consumer Education Specialist, FTC

ARTICLE LINK (CLICK HERE)

Here’s a fun way to think about a tricky topic. You know the scene in Lewis Caroll’s Alice in Wonderland when the white rabbit hops off saying “I’m late! I’m late! For a very important date!”? Imagine the rabbit is a debt collector. The important date? It’s his last chance to legally make you pay money you owe. Why he’s late? The debt collector has run out of time to sue you for an old and unpaid, or time-barred, debt. For more, follow me down the rabbit hole...

What is a time-barred debt?
It’s a debt that’s too old for a debt collector to sue you to make you pay. Debt collectors have a limited number of years – called the statute of limitations – to sue you to collect on money you owe. Statutes of limitations vary by state, and by type of debt.

What can I do if a debt collector calls about an old debt?
Debt collectors can contact you about time-barred debts at any time. If you get a call from a debt collector, they might come right out and say they can’t take you to court to make you pay a time-barred debt. If a debt collector doesn’t tell you this, ask for the date when you made your most recent payment. Then, ask for a validation notice – a legally required letter detailing the amount owed, and the creditor name. Once you receive the notice, send a letter back within 30 days explaining that you are 'disputing' the debt and that you want to 'verify' it. Debt collectors must stop trying to collect until they give you verification.

What if I’m sued for an old debt?
Don’t ignore it. Defend your debt collection rights. Consider talking to an attorney in order to prove that the debt is time-barred, and have the lawsuit dismissed. To do this, you may be asked to provide a copy of the verification from the collector, or any information you have that shows the date of your last payment.

Do I have to pay a time-barred debt?
It’s up to you. Here’s what can happen:

Pay nothing. Not paying a debt may lower your credit rating. So check your free credit report first to see if a time-barred debt has been reported. If the debt appears on your credit report, this could make it harder and more expensive for you to get credit, insurance, or loans. Debts stay on your credit report for seven years after you stop paying. Although debt collectors can no longer sue you for a time-barred debt, it won’t make it go away. Debt collectors can keep contacting you to pay because you still owe the money. If you want them to stop, send a cease communications letter.
Partially pay. If you make, or promise to make, a debt payment, the statutes of limitations clock may reset and your debt will no longer be considered time-barred. A debt collector can then sue you for the full debt amount, plus interest and fees.
Pay it off. Before making a full payment, get a signed letter from the debt collector saying that your entire debt is being settled to release you from further obligations.

Debt or debt collection issues on your mind? Talk to us! Write your questions in the comments section below, and we will pick a few to answer. To report a scam, visit ftc.gov/complaint.

Tagged with: credit report, debt, debt collection

Blog Topics:

Money & Credit

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Please contact us if you need help or resources as we are here and happy to help!

Respectfully,

Dana Shafman

Managing Member

END Consulting

(888) 234-7006 Ext 101

Dana@ConsultingEND.com

www.TheDailyComplaint.com

Wednesday, August 5, 2015

NATIONSTAR MORTGAGE

NATIONSTAR COMPLAINT:

Submitted: July 2015

Reported By: Bob in Kansas City, Missouri

Report Link: CLICK HERE

Loan Modification Fraud

Have been dealing with Nationstar as a mortgage servicer for the last 4-5 years. Several instances of unexplained charges on billing, but nothing of a major issue. Until now. Was injured on the job June of 2013, have been unsuccessful in collecting workers comp. Wages a have declined due to my injury to around 35-40% of my previous income. have used savings to keep up until january 2015.

Received invitation from Nationstar in Marrch 2014 to Refinance. Responded by phone, to initiate process. Had an assigned " Loan Specialist" Called back next day to provide additional information that had been requeested, and was advised that the individual that had been assigned as my "loan specialist" was no longer employed by nationstar. Next "loan specialist" after requesting income and employment verification sent me a letter approximately a week later that stated that I did not meet criteria fror a refinance.

Received letter from Nationstar dated March 9, 2015, stating that upron their review, my mortgage qualified for modification. The letter states" To accept this option, within 14 days of the date of this letter you must call us at (877)450-8638 to confirm your participation or make your first Trial period payment. If you follow the terms of the enclosed Trial Period Plan, your loan will be permanently modified."

The last sentence in the previous paragraphcan be interpreted in a legal proceeding as nothibng but an absolute confirmation of actiion! But that's not the Natiionstar way. After making three timely payments that the Trial Period Plan called for, I recieved a Letter from Nationstar on June 18,2015 with the following statement. " We recently received a payment on your behalf in the amount of $807.04. We are returning these funds as they are insufficient to bring your account current. As of the date of this letter, the total amount required to bring this account current is $6,732.79."

To date there has been no accounting from Nationstar of the disposition of the first 2 Trial Plan payments, nor has the payment referred to in the June 18.2015 letter been returned. Current status is threat to resume foreclosure proceedings.

My intent is to use my limited resources to file an action against Nationstar and their "Dedicated Loan Specialist" Kyle Lindgard for Fraud.

END CONSULTING ADVICE:

Hi Bob,

It is absolutely disgraceful how Nationstar Mortgage has treated you not to mention a violation of your consumer rights. With that said, you do have rights and by simply understanding them and knowing how to exercise them, you can hold Nationstar Mortgage accountable for their actions while securing a permanent loan modification since you have already complied with the Trial Period Plan (TPP).

I would first suggest that you visit the CFPB's website (click here for CFPB website) to learn more about your consumer rights and you will also want to contact the Making Home Affordable (MHA) Home Affordable Modification Program (HAMP) escalations team to get them involved with your mortgage loan and successful TPP completion.

We battle Nationstar Mortgage daily and win with a trial period plan issues as well as other debt restructuring issues so just keep fighting until you get the solution that you are seeking. We would be more than happy to educate you as to how to fight for your rights. My firm routinely seeks out complaints online so that we can educate as to how to fight back on our weekday show called "The Daily Complaint" where we review a complaint and how to tackle it successfully.

We reviewed your Nationstar Mortgage complaint on the show if you would like to listen, click here.

In addition to submitting complaints to the CFPB and MHA HAMP escalations team, I would always suggest preparing a QWR or Request for information for Nationstar Mortgage that you can submit via fax or email – you can learn how through the CFPB by typing in QWR in their search bar.

Nationstar Mortgage is required to acknowledge the QWR or Request for information per RESPA in 5 business days and answer it in 30 business days or you do have recourse, so listen to us address the Nationstar Mortgage issues on The Daily Complaint today and contact us if you need further information on how to not only attack your problem but to get the solutions that you are seeking.

Good luck!