On August 21, 2024, the Consumer Financial Protection Bureau (CFPB) announced that it entered into a consent order with a Florida-based mortgage servicer, resolving allegations related to the mortgage servicer’s foreclosure practices.
The consent order resolves allegations that the mortgage servicer’s foreclosure practices violated the Consumer Financial Protection Act of 2010 (CFPA), 12 U.S.C. §§ 5531, 5536; the Real Estate Settlement Procedures Act (RESPA), 12 U.S.C. §§ 2601-2617, and its implementing regulation, Regulation X, 12 C.F.R. part 1024; the Truth in Lending Act (TILA), 15 U.S.C. §§ 1601-1667f, and its implementing regulation, Regulation Z, 12 C.F.R. part 1026; the Homeowners Protection Act (HPA), 12 U.S.C. §§ 4901-4910; and a 2017 consent order the mortgage servicer had previously entered into with the CFPB.
Specifically, the CFPB alleged that the mortgage servicer failed to timely review loss mitigation applications from borrowers before placing foreclosure holds; failed to maintain policies and procedures to ensure the provision of accurate and timely information where requested by borrowers; failed to disclose to borrowers in foreclosure how their property retention preferences could limit their loss mitigation options; failed to timely terminate private mortgage insurance, refund unearned premiums, and properly disclose premiums in escrow account statements; and assessed excessive or incorrectly calculated late fees.
Under the terms of the consent order, the mortgage servicer agreed to pay $3 million in redress to consumers and a civil money penalty of $2 million. The mortgage servicer also agreed to invest $2 million to update its servicing technology and compliance management systems.
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