The CFPB recently reiterated to mortgage servicers its strong encouragement for them to participate in Homeowner Assistance Fund (HAF) programs – meant to help homeowners financially impacted by COVID-19 to pay their mortgage or other home expenses – to help prevent avoidable foreclosures on borrowers. The specific programs and borrower application and approval processes vary by state, tribe, or territory.
In setting its expectations, the CFPB reminded servicers of relevant considerations, including that: (i) their participation in HAF programs is entirely voluntary, but encouraged; (ii) servicers are encouraged to provide proper training and information to their customer service representatives regarding HAF programs; (iii) servicer requirements to provide borrowers with accurate information about the loss mitigation process include HAF-related considerations (e.g., about servicer participation in the HAF program and communication during the HAF application process); and (iv) servicer requirements to maintain adequate policies and procedures to ensure proper evaluation of loss mitigation applications include HAF-related considerations as well (e.g., providing accurate information about available HAF-related loss mitigation options and ensuring no improper referrals to foreclosure during HAF-related activities).
The CFPB also noted HAF-related issues that it will consider as part of its close monitoring of servicer conduct, described generally in CFPB Bulletin 2021-02 (Supervision and Enforcement Priorities Regarding Housing Insecurity). See WBK’s prior article here, addressing that bulletin.