Summary: CFPB Interim Final Rule re: Mortgage Servicing Rules under the Real Estate Settlement Procedures Act (Regulation X)
12 CFRP part 1024
NASCUS Legislative & Regulatory Affairs Division
The Consumer Financial Protection Bureau (Bureau or CFPB) is issuing an interim final rule amending a provision of the 2016 Mortgage Servicing Rules relating to the timing for servicers to provide modified written early intervention notices to borrowers who have invoked their cease communication rights under the Fair Debt Collection Practices Act (FDCPA).
The interim final rule becomes effective on October 19, 2017. Comments must be received by November 15, 2017. The rule can be found here.
In August 2016, the Bureau amended the 2013 Mortgage Servicing Rules under the Real Estate Settlement Procedures Act (RESPA) and the Truth in Lending Act (TILA). Specifically, the 2016 Mortgage Servicing Final Rule amended a provision that related to the timing requirements for written early intervention notices for borrowers who invoke their cease communications rights under the Fair Debt Collection Practices Act (FDCPA). Under the 2016 provision, a servicer subject to the FDCPA with respect to a borrower’s loan must provide a modified written early intervention notice to the applicable borrower on a periodic basis but is prohibited from doing so more than once during any 180 day period.
The Bureau is concerned that this provision imposes too narrow a window for compliance and may provide insufficient guidance as to when/how servicers comply with the timing requirements under certain circumstances. Therefore, the Bureau has issued this interim final rule to amend Section 1024.39(d)(3)(iii) to give servicers a 10-day window to provide the modified notice at the end of the 180-day period.
The Bureau is requesting comment on this interim final rule. Based on the comments received, the Bureau will consider whether to revisit this rule.