The Consumer Financial Protection Bureau (CFPB) has proposed a series of new rules it says will to protect homeowners from “costly mistakes” by the mortgage servicers responsible for collecting payments on behalf of the loan’s owner.
The Dodd-Frank Act imposes various requirements on servicers and gave the CFPB statutory authority to write rules. The proposals, announced on Friday morning, would go into effect in January 2013. Among the stipulations is that the “servicer would not be able to actually foreclose on the consumer without fully considering borrowers’ timely and complete applications for alternatives to foreclosure.”
