1. New Mortgage Servicing Rules
Ashley Hutto-Schultz
Director of Compliance
Castle & Cooke Mortgage

2. Supervisory Efforts Persistently focused on mortgage servicing
Guidance
Updated examination procedures (6/2016)
Examinations
Supervisory Highlights – Special Edition (6/2016)
Enforcement actions, to name a few:
Residential Credit Solutions (7/2015)
Green Tree Servicing (4/2015)
Flagstar Bank, F.S.B. (9/2014)

3. Trends CFPB particularly interested in: Default servicing
Loss mitigation
Servicing transfers
Technology-driven processes

4. Final Rule New definitions: Delinquency Successors in interest
Loss mitigation procedures and foreclosure protections
Periodic statements and early intervention notices for borrowers in bankruptcy
FDCPA Interpretive Rule

5. Delinquency
Definition: “[B]eginning on the date a periodic payment sufficient to cover principal, interest, and, if applicable, escrow becomes due and unpaid, until such time as no periodic payment is due and unpaid.”

6. Delinquency – Impact Timing requirements Early intervention
Continuity of contact
120-day foreclosure waiting period
Tolerances and timely payments from escrow
Loan modifications

7. Successor in Interest Definition now also includes:
Spouse or children who become an owner of the property
Person to whom ownership was transferred as a result of a divorce decree, legal separation, or incidental property settlement agreement
Inter vivos trust in which the borrower is, and remains, a beneficiary
Person who received a transfer of property as described in regulations from the Federal Home Loan Bank Board

8. Successors in Interest – Impact
Servicing transfers
Error resolution
Request for information
Early intervention
Continuity of contact
Loss mitigation
Force-placed insurance
Escrow provisions

9. Loss Mitigation Related to: Status updates
Resubmission of applications
Foreclosure sale prohibition, in some cases

10. FDCPA Interpretive Rule:
Safe harbor if compliant with mortgage servicing rules, specifically regarding:
Communicating with successors in interest
Providing early intervention notice or responding to borrower-initiated communication regarding loss mitigation for a borrower who invoked “cease communication” right under FDCPA

11. How to Prepare
Effective 12 months – or 18 for bankruptcy and successor in interest provisions – after Federal Register publication
Compliance management framework:
Policies
SOPs
Training
Vendor management
IT solutions
Subservicers

12. Questions?

13. Thank you.