DS News

DS News December 2022

DSNews delivers stories, ideas, links, companies, people, events, and videos impacting the mortgage default servicing industry.

Issue link: http://digital.dsnews.com/i/1488299

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Page 78 of 99

77 77 77 INVESTMENT GOVERNMENT PROPERTY PRESERVATION Journal Follow Us At: @DSNewsDaily FANNIE MAE SECURITIES TO FEATURE NEW SOCIAL DISCLOSURES Fannie Mae is now attaching two new social disclosures to their single-family mort- gage-backed securities (MBS), called the Social Criteria Share (SCS) and the Social Density Score (SDS), which are designed to respond to investor feedback and aims to provide MBS in- vestors with insights on socially oriented lending activities while helping individual consumers preserve their confidentiality. Going forward, Fannie Mae will issue SCS and SDS disclosures at the issuing point starting December 2. To help with historical analysis, Fannie Mae is also providing charts containing common visualizations of prepayment activity. "We're excited to release the new social disclosures after receiving positive feedback on the proposal over the last several months," said Devang Doshi, SVP of Single-Family Capital Markets at Fannie Mae. "is is a significant step forward in terms of providing insights for market participants while working to protect borrower privacy, and we remain committed to continued engagement with the investor community for further developments in socially conscious investments." While these pool-level disclosures may support investors in determining which pools may meet their socially minded investment criteria, Fannie Mae is not labeling any pools as Single-Family Social Bonds. Fannie Mae will consider feedback from investors, second-party opinion providers, and other market participants to determine how to approach potential labeled issuance. and practices to be more transparent in handling such complaints. Additionally, CFPB examiners found violations of the accuracy obligations of the FCRA by furnishers, including finding that auto loan furnishers were reporting inaccurate information about consumer loans despite knowing that the information was inaccurate. In response to these findings, furnishers corrected the inaccurate information for affected consum- ers and made it easier for consumers to submit disputes directly to the furnishers. CFPB examiners identified legal violations related to add-on product charges, loan modi- fications, double billing, electronic devices that interfere with driving, and debt collection tac- tics. In several examinations, examiners focused on junk fees. For example, examiners reviewed servicers' handling of add-on product charges where individuals had paid the full amount for certain add-on products as a lump sum at loan origination and made payments on these add-on products throughout the loan term. Examiners identified instances where borrowers paid off their loans early, but servicers engaged in an unfair practice by failing to provide refunds for unearned fees related to the add-on products. e borrowers were entitled to refunds of the related unearned fees because, upon early payoff, the loan and the add-on products terminated and no longer offered any possible benefit. CFPB examiners have conducted assess- ments to evaluate how financial institutions handled pandemic relief benefits deposited into consumer accounts. ey identified policies and procedures that may have resulted in people losing their pandemic relief benefits due to garnishments or setoff practices. In response to these findings, the CFPB directed the institu- tions to issue refunds and make process changes to ensure they comply with applicable state and territorial protections regarding garnishments and setoff practices. Certain CFPB examinations also focused on mortgage servicers' actions as homeowners experienced financial distress related to the COVID-19 pandemic. CFPB examiners identi- fied violations regarding failure to timely provide homeowners with CARES Act forbearances. Examiners also found that servicers unfairly charged some individuals fees, while they were in CARES Act forbearances, as well as failed to maintain policies and procedures reasonably designed to properly evaluate homeowners' loss mitigation options when CARES Act forbear- ances expired.

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