Infobytes Special Alert: CFPB Issues Mortgage Servicing Rule Amendments And Guidance Addressing Conflicts With Bankruptcy And Debt Collection Rules

On October 15, 2013, the Consumer Financial Protection Bureau (“CFPB”) issued an interim final rule amending certain provisions of its mortgage servicing rules and making technical changes to other January 2013 mortgage rules (the “Interim Amendments”). In particular, the amendments address issues raised by bankruptcy trustees and industry about the incompatibility of the servicing rules with protections afforded to consumers by bankruptcy law and the Fair Debt Collection Practices Act (“FDCPA”). The CFPB also issued a bulletin providing guidance on other aspects of the servicing rules and an advisory opinion on the interaction between the rules and the FDCPA (the “Bulletin”). In addition, on October 16, 2013, CFPB staff provided unofficial oral guidance on specific questions about the mortgage servicing rules in a webinar hosted by the Mortgage Bankers Association. BuckleySandler attorneys attended the webinar and can address any questions you may have.

Like the mortgage servicing rules, the Interim Amendments will take effect on January 10, 2014. The CFPB issued the Interim Amendments without advance notice and public comment because of the impending effective date. The public will have 30 days to provide comments after publication of the amendments in the Federal Register (which has not yet occurred). After the comment period, the CFPB may make adjustments to the Interim Amendments before adopting them in final form.

Please see full Special Alert below for more information.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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