In our March 2017 Newsletter, we discussed changes to the periodic statement requirements that came out of the Mortgage Servicing rules. Some of those changes were effective last October and some (specifically for borrowers in bankruptcy) are set to take effect on April 19, 2018. One of the changes that’s effective April 19th, is a requirement to provide modified statements/coupon books for certain borrowers in bankruptcy and then potentially to transition back to unmodified statements/coupon books.
The CFPB has made a bit of a last-minute change to this requirement. Specifically, you don’t have to provide a statement for the cycle immediately following the event that would cause you to provide modified or unmodified statements (i.e., a “single-statement exemption”). As the rule was originally written, you might have a transition period, but only if the timing all worked out. The CFPB’s recent tweak will exempt servicers from providing the next statement/coupon book, regardless of the timing involved. For example, say a borrower’s bankruptcy filing on March 1st requires you to transition to modified statements for that borrower. Under the amended rule, you won’t be required to provide a March statement, but must still transition to modified statements beginning in April.
There are a LOT of technical requirements related to these periodic statement/coupon book requirements. We would encourage you to look back at our March 2017 Newsletter to better understand when modified statements are required and when you potentially need to switch back to unmodified statements.
If you want more on this change or just the Mortgage Servicing requirements as a whole, be sure to check out our Mortgage Servicing webinar on July 31st.
If you want to step back and take a look at mortgage loan compliance requirements, from when you receive an application all the way through mortgage servicing, you can purchase our Mortgage Life Cycle webinar series (8 hours of training) or if in-person training is more your style, join us live in Sioux Falls, SD on May 1st & 2nd.
Diane joined Banker’s Compliance Consulting with over 10 years of compliance experience and over 15 years of experience within the financial industry. Diane is a Certified Regulatory Compliance Manager (CRCM) and has a Bachelor’s Degree in Sociology with a concentration in Criminal Justice. She is a graduate of the Schools of Banking Compliance School and has participated in various other training opportunities throughout her career. Diane understands firsthand the struggles banks face in building and maintaining successful compliance programs. Her experience and common sense approach to consumer compliance is a great asset to our clients.
Diane and her husband have two kids who keep them busy. She enjoys running and other sports and is a big Bugs Bunny fan! She’s a bit crazy in that she does enjoy reading some of these regulations and she’s a “crazy cat lady!” Her cat tales are hilarious!