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44 | M R EP O RT SERVICING THE LATEST O R I G I NAT I O N S E R V I C I N G DATA G O V E R N M E N T S E C O N DA R Y M A R K E T Stepping Up Efforts to Avoid a Foreclosure Wave The CFPB, along with other federal regulators, calls on mortgage servicers to safeguard at-risk homeowners in the wake of pandemic protections. T he Consumer Financial Protection Bureau (CFPB), along with the Board of Governors of the Federal Reserve, Federal Deposit Insurance Corporation (FDIC), National Credit Union Administration (NCUA), Office of the Comptroller of the Currency (OCC), and state financial regulators have issued a joint statement to mortgage servicers announcing a return to enforcement of critical pandemic-related protections for families and homeowners. The protections seek to prevent a foreclosure crisis in the wake of the COVID-19 pandemic, of- fering homeowners the chance to find alternatives to foreclosure before losing their home. The Mortgage Bankers Association (MBA) esti- mates that approximately one million Americans are currently in a state of forbearance, and with a majority of those plans expected to expire before the end of the year, at-risk homeowners will need these protections to avoid foreclosure. "Failures by mortgage servicers and regulators worsened the impact of the economic crisis a decade ago," CFPB Director Rohit Chopra said. "Regulators have learned their lesson, and we will be scrutinizing servicers to ensure they are doing all they can to help homeowners and fol- low the law." The joint announcement clarifies the fact that these agencies will apply their respective supervisory and enforcement authorities to protect homeowners and address any compliance failures. The announcement also cites the "Joint Statement on Supervisory and Enforcement Practices Regarding the Mortgage Servicing Rules in Response to the COVID-19 Emergency and the CARES Act," released April 3, 2020, which stated that the agencies would relax supervisory and enforcement oversight with respect to certain re- quirements in Regulation X, will no longer apply. The April 2020 ruling noted that the pandemic created staffing issues and other obstacles for ser- vicers at the outset of COVID-19 in dealing with clients. The agencies believe that the servicers have had adequate time to adjust their operations to comply with the timelines and other require- ments of Regulation X and servicers will now be expected to fully comply with the rules. The CFPB also issued the 11-page study, "Mortgage Servicing Efforts in Response to the COVID-19 Pandemic," detailing the CFPB's ef- forts to help struggling homeowners and avoid a foreclosure crisis. "We have adapted our supervision approach to hold servicers accountable, amended our mort- gage servicing rules to provide specific COVID-19 protections, and we continue to provide direct assistance to homeowners through complaint intake and distribution of information, including in-language information to make sure all home- owners have a chance to avoid foreclosure," said the CFPB in its report. The CFPB highlights the following actions it took to protect homeowners over the past 18-plus months: • Conducted assessments and supervisory reviews to obtain real-time information from mortgage services due to the elevated risk of consumer harm because of the pandemic. • Reminded servicers that "unprepared is unac- ceptable," and that servicers need to dedicate their resources to ensure clear channels of communication with borrowers. • Implemented temporary procedural safeguards to help ensure that borrowers have time before a foreclosure process were to begin to cover all their options. • Analyzed consumer complaints regarding mortgage servicing and forbearances. • Established a website at www. ConsumerFinance.gov/housing, in partner- ship with other federal agencies, to connect homeowners, renters, and landlords with information about CARES Act assistance and protections. • Created and distributed homeowner outreach materials, in English and other languages for use by those impacted by the pandemic. THE LATEST ORIGINATION