In late June 2016, the CFPB released a special edition of its supervision report that focused specifically on mortgage servicers. Based on the CFPB’s numerous examinations of mortgage servicers, the report found that many servicers continue to use outdated and deficient technology that is harmful to consumers and that also potentially violates the Bureau’s new servicing rules. The report specifically highlighted issues dealing with late, incorrect, or deceptive information related to loan modifications and other forms of loss mitigation as the result of technological breakdowns or malfunctions, as well as issues created by loans being transferred among servicers with incompatible computer systems.
While the Bureau noted that some servicers have made significant improvements to their technology and systems, many have not, resulting in a variety of consumer issues and frustrations. In connection with the report, CFPB Director Richard Cordray said, “Mortgage servicers can’t hide behind their bad computer systems or outdated technology. There are no excuses for not following federal rules . . . . Mortgage servicers and their service providers must step up and make the investments necessary to do their jobs properly and legally.”
This special report highlights the importance of updated technology to servicer work flows and customer satisfaction. At a time when data security and customer privacy issues are at the forefront of industry hot topics, it is an important reminder to lenders and servicers alike that a focus on technology can not only improve your security and compliance regime, it can also result in increased customer satisfaction and efficiencies.
To access the full supervision report, click here.