The NCUA has issued a regulatory alert to credit unions regarding the CFPB’s amendment of mortgage servicing requirements for borrowers affected by the COVID-19 emergency.
The letter states that the requirements only apply to servicers that service mortgages secured by a borrower’s principal residence, and that the rule does not apply to small servicers.
The CFPB amendment, a final rule that was published in the Federal Register on June 30, establishes temporary procedural safeguards to help ensure that borrowers have a “meaningful opportunity” to be reviewed for loss mitigation before the servicer can make the first notice or filing required for foreclosure on certain mortgages.
Specifically, the letter defines key provisions of the rule. It:
- defines COVID-19 related hardship (amends section 1024.31);
- modifies early intervention requirements (amends section 1024.39);
- permits modifications based on incomplete application (amends section 1024.41); and
- establishes temporary COVID-19 loss mitigation procedural safeguards (amends section 1024.41).
The regulatory alert is available on the NCUA website.