Understanding Mortgage Servicing Reforms 2011
Major concerns with mortgage servicing were raised after servicers, struggling to keep up with the tidal wave of loan defaults, were accused of having inadequate processes in place. Attention has shifted to massive reforms in servicing, coming at the industry from many regulators.
The Obama administration is spearheading efforts to reform mortgage servicing incentives and compensation. Meanwhile, federal regulators completed a review of 14 servicers that handle more than two-thirds of mortgages outstanding. The review resulted in consent orders for the servicers as well as Lender Processing Services and MERS. Companies that were not subject to consent orders are likely to be impacted as well.
State regulators and attorneys general are also demanding significant changes in mortgage servicing practices and threatening to impose monetary penalties on servicers. And Fannie Mae and Freddie Mac were directed by the Federal Housing Finance Agency to revamp servicing standards for delinquent mortgages.
Prepare for these massive changes with Understanding Mortgage Servicing Reforms 2011, a new report from Inside Mortgage Finance Publications. Topics covered include:
Analysis of Federal Consent Orders 
- Significant Weaknesses Uncovered
- Arrangements with Outside Law Firms
- Comprehensive Action Plan
- Foreclosure Review & Sampling
- Single Point of Contact & Vendor Management
- Other Servicing Requirements
- Differences Between Orders and Review
- Bank/Thrift Holding Companies
Impact on Non-Consent Order Servicers
- Best Practices for Servicers
- Concerns with Some Provisions
- An Opportunity for Some
- Loss Mitigation & Communication Efforts
- Staffing and Training
- Foreclosure Practices
Other Federal Initiatives
- Oversight by Federal Regulators
- CFPB Outlook
- National Servicing Standards
- Qualified Residential Mortgages
- Non-Agency Loan Problems
- Impact of Servicing Problems
State Efforts
- State Regulator Perspective
- Scope of Reviews
- Dual-Track Foreclosures
- Principal Reduction
- Judicial & Non-Judicial Foreclosures
- Problems with Trustees
- Outlook
GSE Initiatives
- Servicing of Delinquent Mortgages
- Financial incentives
- Dual-Track Foreclosures
- Compliance Monitoring
- Changes to Servicing Compensation
- Initial Response
This 75-page report also includes exclusive insight and analysis from industry lawyers, an official from a major servicer and a state regulator.
