Prior to FHFA’s new directive, Fannie and Freddie required homeowners who have been through foreclosure and want to buy their home back to pay the entire amount owed on the mortgage.
The Mortgage Forgiveness Debt Relief Act allows homeowners who received principal reductions or other forms of debt forgiveness to avoid paying taxes on the amount forgiven.
If anyone in the housing finance industry thought the CFPB was finished with its mortgage-related rulemaking, they were wrong. Last week, the CFPB issued a batch of proposed amendments to its 2013 mortgage servicing rules, including a number of changes to how servicers handle loss-mitigation applications. First, the bureau is proposing to require servicers to meet the loss-mitigation requirements of its mortgage servicing rules more than once in the life of a loan for borrowers who become current after a delinquency. However, the rule is not clear how many times this could occur over the life of the mortgage. A little insight can be gleaned from a CFPB blog posting geared towards borrowers, which stated, “We are also proposing that ...
There are eight other subject areas included in the CFPB’s 490-page proposed rulemaking to amend its 2013 mortgage servicing rules, above and beyond the extensive amount of revisions to loss mitigation practices, as highlighted above. The first of those has to do with successors in interest – people who inherit or receive property when there is still an outstanding mortgage loan on the property. The bureau is proposing three sets of rule changes relating to successors in interest, the first of which is to apply all of its mortgage servicing rules to a successor in interest once a servicer confirms that a person is a successor in interest. Second, the bureau is proposing rules relating to how a mortgage servicer makes ...
Under current rules, a servicer cannot explain on the notice itself that the borrower’s hazard insurance is insufficient rather than expired or expiring...
The mortgage servicing settlements the CFPB obtained with Ocwen, SunTrust Bank and Flagstar Bank have much to teach the rest of the industry about landmines to avoid. During a webinar sponsored last week by Inside Mortgage Finance, an affiliated newsletter, Allyson Baker, a former CFPB attorney and partner at the Venable law firm in Washington, DC, highlighted the importance of trends seen in the three enforcement cases. “Number one is the bureau’s and other law enforcement agencies’ ongoing joint monitoring of the space,” which suggests the industry is likely to see more joint enforcement actions in the future, Baker told event participants. The second important trend is the very large civil money penalties and restitution that are resulting in tens ...