Will the New Mortgage Rules for Servicers Affect You?
As a result of the numerous complaints filed with the Consumer Finance Protection Bureau, the Bureau has proposed new regulations. If enacted, these rules could be in effect as early as January 2013. Here are some of the proposed regulations and the answers to some of the questions that people are asking about them.
Do the new rules affect people who are current on their mortgage payments?
The new regulations that are being proposed by the Consumer Finance Protection Bureau are the first rules that apply to all homeowners, regardless of their mortgage loan status.
What changes should homeowners expect to see on their mortgage statements?
For the most part, mortgage statements are going to look the same way that they look now. They will show your monthly payment amount, your current balance, and any fees that you are paying along with your mortgage. One of the changes that you may see, however, is that the new statements will list potential rate adjustment so you can prepare for them if you have an adjustable rate mortgage.
Who is servicing your mortgage?
One of the complaints that many homeowners filed with the Consumer Finance Protection Bureau is that they were unclear as to who was serving their mortgage. Mortgages are sold all the time. It is actually very common for your mortgage to get sold at least one time during the term of the mortgage. But your mortgage company doesn’t always advertise that it has sold your mortgage. With the new regulations, your mortgage statements will present information clearer to help prevent misunderstandings.
What happens if a servicer breaks these new rules?
While there were no specifics laid out in the new regulations, the Consumer Finance Protection Bureau has the authority to alter mortgage servicers that violate these rules. If you are expecting a windfall from being mistreated by a mortgage servicer, though, you should not set your expectations too high. You may reserve the right to sue the servicer under the new provisions, but you are not likely going to receive a huge settlement.
The main idea of the new regulations is to encourage some of the larger mortgage servicers, such as Wells Fargo and Bank of America, to offload some of their mortgages onto smaller banks and lenders. Also, the Consumer Finance Protection Bureau is allowing some time for the general public to comment on the new regulations before making them final in January. Do you welcome the new regulations or do you think it’s going to create more bureaucratic red tape than already exists?
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