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Regulators Extend Deadline for Servicers’ Foreclosure Review Plans
Posted By Carrie Bay On June 13, 2011 @ 3:51 pm In Foreclosure,Government,Loss Mitigation | No Comments
Federal regulators with the ""Office of the Comptroller of the Currency"":http://www.occ.gov (OCC) and the ""Office of Thrift Supervision"":http://www.ots.treas.gov (OTS) have issued notices extending the deadline for 12 of 14 mortgage servicers to submit their action plans for conducting foreclosure reviews.
[IMAGE] As part of ""the consent agreements"":http://www.dsnews.com/articles/regulators-hand-down-enforcement-actions-to-servicers-and-their-vendors-2011-04-13 announced in April to settle robo-signing allegations with federal regulators, the servicers are required to retain independent, third parties to review all residential mortgage foreclosure actions processed in 2009 and 2010.
These private consultants are selected and hired by the servicers but must be approved by regulators. They are charged with reporting back to the regulators with the results of the examinations.
Servicers were initially instructed to provide their respective regulator with the third-party consultants' engagement letters within 45 days, by May 31st.[COLUMN_BREAK]
The OCC and OTS explained that at the request of the U.S. Department of Justice and to allow coordination of actions with other agencies at the state and federal level, they have extended the deadline by 30 days.
The OCC's notice is applicable to eight servicers: Bank of America, Citibank, HSBC, JPMorgan Chase, MetLife Bank, PNC, U.S. Bank, and Wells Fargo. The OTS's notice affects four servicers supervised by the agency: Aurora Bank, EverBank, OneWest Bank, and Sovereign Bank.
Two other servicers were also subject to the same consent orders that came from the Federal Reserve: Ally Financial and SunTrust.
The Fed did not issue an announcement Monday related to the deadline extension and did not immediately return requests for clarification on whether Ally and SunTrust would receive the same treatment as the other 12 servicers, but it is widely expected that all three agencies will remain in sync and extend the deadlines universally.
Other provisions of the consent orders that had an initial deadline of 60 days from the April 13th date have also been extended by 30 days, according to the OCC and OTS.
Among these terms are action plans to ensure each servicer maintains the financial resources and staff needed to meet current and future workloads; a strategy for implementing written policies and procedures for the servicing of delinquent loans and the proper use of legal affidavits; and a plan for putting new procedures in place for outsourcing foreclosure and loss mitigation functions and managing any third-party providers.
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