Mortgage servicers would feel the pain if the ""Consumer Financial Protection Bureau"":http://www.consumerfinance.gov/ (CFPB) finalizes new rules it plans to propose this summer, according to ""Fitch Ratings"":http://www.fitchratings.com/web/en/dynamic/fitch-home.jsp.[IMAGE]
The ratings agency said in a statement that ""increased operational, compliance, and reporting expenses"" would take place if the rules take effect without any modification by the agency.
The CFPB issued statements last week that signal its intentions to roll out with new proposals for rules that require more disclosure and transparency from servicers.[COLUMN_BREAK]
Under the new rules, servicers would need to notify homeowners of any changes to interest rates for certain adjustable-rate mortgages, maintain transparency about new force-placed insurance policies, and break down monthly payments by principal, interest, and more.
Analysts with Fitch said they believe that ""the proposed set of rules could... be less relevant with respect to future underwriting, provided that lenders are more focused on the credit quality and financial resources of the borrowers and stability of home prices.""
The move is another in the direction of national servicing standards, according to experts, and continues the work started by the historic $25 national settlement agreed-to in February.
""Joseph A. Smith"":http://www.mortgageoversight.com/, former ""Federal Housing Finance Agency"":http://www.fhfa.gov/ nominee and monitor of the settlement, tells us that the CFPB ""certainly [has] jurisdiction"" over servicing standards and that he hopes the ""exercise will contribute to the development of those standards.
""Ultimately, I think we'll have national standards ├â┬ó├óÔÇÜ┬¼├óÔé¼┼ô and we ought to,"" he says.
_Editor├â┬ó├óÔÇÜ┬¼├óÔÇ×┬ós Note: To see the full, exclusive interview with settlement monitor Joseph A. Smith, ""click here"":http://thefivestar.com/dssubscribe/template.php to subscribe to_ DS News _magazine, our sister publication, and request our May issue._