The CFPB adopted amendments to Regulation X ("Real Estate Settlement Procedures Act") to facilitate the review of foreclosure avoidance options available to mortgage borrowers impacted by the COVID-19 pandemic.
The adopted amendments include:
- temporary procedural safeguards intended to ensure that borrowers have a meaningful opportunity to be reviewed for loss mitigation before a servicer can make the first notice or filing required to initiate foreclosure;
- streamlined loan modification options for borrowers based on the evaluation of an incomplete loss mitigation application; and
- new early intervention obligations for borrowers that (i) are not in a forbearance program or (ii) are near the end of a forbearance program made available due to COVID-19-related hardships.
The final rule also defines COVID-19-related hardship as one due, directly or indirectly, to the national emergency declared in Proclamation 9994 of March 13, 2020.
The final rule goes into effect on August 31, 2021.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.