Servicers Face New Rules, Penalties for Foreclosure Processing Mistakes
This article outlines the work done over the past few months to investigate the foreclosure and servicing practices of 14 mortgage companies, including the Mortgage Electronic Registration Systems, Inc. (MERS) and Lender Processing Services (LPS). The findings include shortcomings in specific processes related to foreclosure governance, document preparation and oversight of third-party law firms, some of which violated state and local foreclosure laws. Regulators are developing operational changes to be made, as well as sanctions and penalties against servicers and assistance for borrowers who have been negatively affected by these practices. In addition, mortgage servicing standards are being developed that include 12 specific areas for servicers to follow nationwide.
SOURCE: DSNews, 2/17/11
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