Implementing Periodic Statements for Mortgage Loans in Bankruptcy
The CFPB has been signaling for years that the exemption to provide periodic statements for mortgage loans in bankruptcy will be amended, and on October 19th2016, the amendment was finally published in the Federal Register. The new requirement to send statements on bankrupt mortgage loans, set to go into place on April 19th, 2018, is complex and will have significant impacts on mortgage servicers’ default management processes and technology infrastructure.
The new requirements will specifically require process changes for many organizations related to how Chapter 13 payment plans are tracked within internal systems – which is something the CFPB specifically addressed in their final rule by stating:
“The Bureau understands and appreciates the concerns expressed by many servicers that their systems are not currently set up to easily track how payments are applied in Chapter 13 cases and that, in order to be able to disclose this information on a periodic statement, they may need to incur significant costs to upgrade their systems.”
Thus, for banking compliance, operations and technology professionals, the time is now to address technology challenges associated with servicing bankrupt loans.
The white paper, Implementing Periodic Statements for Mortgage Loans in Bankruptcy, prepared with contributions from Fox Rothschild LLP, discusses when servicers are required to send periodic statements, information required on the statement, technologies that may need to be implemented in order to comply, and operational best practices when deploying the new process. Download the full paper here to learn more.