NY Department of Financial Services Issues Mortgage Loan Servicer Business Conduct Rules FAQs

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The NY Department of Financial Services (DFS) recently issued FAQs and an industry letter related to 3 NYCRR Part 419 (Final Part 419).  Final Part 419, which was recently promulgated, reaffirms and codifies requirements under Regulation X and Regulation Z as well as standard industry best practices. 

The industry letter specifically addressed two common questions related to Final Part 419.  The DFS made clear that a servicer who does furnish a periodic statement to a borrower for a Home Equity Line of Credit (HELOC) or an open-end credit plan (per 12 CFR § 1026.7) does not need to issue a periodic statement to the borrower under 3 NYCRR § 419.4(c).  Additionally, the industry letter clarifies that 3 NYCC §419.7 requirements regarding loss mitigation and delinquencies only apply to open-end credit plans or HELOCs that are in first lien positions. 

The FAQs outline which entities are impacted by Final Part 419 and detail important definitions and exemptions.

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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