In a September 26 settlement, the Massachusetts Attorney General’s office reached an agreement with a mortgage loan servicer to resolve allegations of violations of Massachusetts consumer protection laws and the Truth in Lending Act.Continue Reading Massachusetts AG Reaches Settlement with Loan Servicer Over Improper Debt Collection Practices
On October 15, the CFPB and the DOJ announced a settlement against a large mortgage lender for its alleged discriminatory redlining practices against residents of majority-Black neighborhoods in the greater Birmingham, Alabama area in violation of the Fair Housing Act, the Equal Credit Opportunity Act, and Consumer Financial Protection Act. Redlining occurs when lenders discourage credit applications, deny equal access to home loans and other credit services in certain areas, or avoid providing home loans based on applicants’ protected class status, such as the race, national origin, or color of the residents of those areas.Continue Reading CFPB and DOJ Target Mortgage Lender for Alleged Discriminatory Redlining Practices
On September 20, Governor Newsom signed AB 2424, which establishes a significant set of new foreclosure notification and sale requirements for mortgage lenders. The law is effective as of January 1, 2025.Continue Reading California Passes Law Extending new Protections to Mortgage Borrowers
On August 21, the CFPB entered into a consent order with a nonbank mortgage servicer for mortgage servicing violations and for violating an earlier 2017 CFPB consent order for deficient foreclosure practices. Continue Reading CFPB Hits Executive Compensation in Action Against National Mortgage Servicer for Illegal Foreclosure Practices
On July 10, the CFPB announced proposed rules for mortgage servicers, aimed at helping homeowners avoid foreclosures. The new rules, which would modify RESPA and Regulation X’s existing mortgage servicing framework, are designed to streamline the process for obtaining mortgage assistance, and incentivize servicers to prioritize borrower aid over foreclosure.Continue Reading CFPB Proposes Revamped RESPA Mortgage Servicing Rules
On May 23, the U.S. Department of Housing and Urban Development (HUD) announced that Federal Housing Administration-approved Mortgagees are subject to a heightened cybersecurity incident reporting regime. The new requirement, which amends the Single Family Housing Policy Handbook 4000.1, requires FHA-approved Mortgagees to report “suspected” “Significant Cybersecurity Incidents” within 12 hours of detection. Continue Reading FHA’s Releases 12-Hour Cyber Incident Notification Rule
On May 16, the CFPB filed a motion for summary judgement in the U.S. District Court in the Southern District of Florida seeking a $20 million civil penalty against a California-based mortgage provider for allegedly submitting inaccurate government mortgage loan data.Continue Reading CFPB Files Motion for Summary Judgment on HMDA Enforcement Action
On April 26, the U.S. Department of Housing and Urban Development (HUD) issued Mortgagee Letter 2024-06, announcing changes to the Home Equity Conversion Mortgages (HECMs) for purchases (H4P loans), a mortgage program designed for older homeowners who wish to buy a primary residence using a reverse mortgage. The program allowed seniors to purchase a new home that better suits their needs without the burden of monthly mortgage payments.Continue Reading HUD Updates Home Equity Conversion Rules for Purchases
In an April 16 unpublished opinion, the U.S. Ninth Circuit Court of Appeals affirmed the Bankruptcy Appellate Panel’s earlier decision finding that a mortgage lender not licensed in California violated the state’s usury law when it extended the term of the loan and lowered the borrower’s interest rate on a broker-arranged mortgage loan that it owned. Continue Reading Ninth Circuit Holds Loan Modification Made By Unlicensed Lender Violates State Usury Law
On January 11, 2024, an administrative law judge for the NLRB issued an opinion holding that the employment agreement used by a major mortgage lender for all of its approximately 6,000 employees violates the National Labor Relations Act (NLRA). The mortgage lender’s standard employment contract included provisions that: 1) restricted disclosure of confidential information; 2) governed the use and return of company property, information, and communications; and 3) required that certain disputes be resolved through arbitration. Many of these provisions are common in employment agreements between lenders and their employees. Nevertheless, the ALJ found that parts of these provisions violated the NLRA because they had a reasonable tendency to interfere with, restrain, or coerce an employee contemplating engaging in activity protected by the statute.Continue Reading NLRB Finds Common Provisions in Mortgage Lender Employment Contract Illegal