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36 the regulations took effect. e RESPA loss mitigation regulations also give borrowers the right to delay a number of milestones in the foreclosure process if they do submit timely and complete loss mitigation applications. Section 1024.41 of the regulations entitles borrowers to delay the following milestones, if the borrower has submitted a compliant application: (i) the initial filing of a foreclosure action, (ii) any motion for judgment that the servicer might file, and (iii), most importantly, a judicial sale of the mortgaged property. If servicers violate these regulations, borrowers have the right to recover actual damages caused by the violation, costs of an action filed against the servicer, and attorney fees. Statutory damages can be recovered if the borrower demonstrates that the servicer engaged in a pattern or practice of violating the regulations. It is also important to note what rights borrowers do not have under these regulations, but which they may attempt to assert nevertheless. Even if they establish liability against a servicer for violating these regulations, borrowers are not entitled to rescind a foreclosure sale. e regulations do not provide borrowers with the right to equitable or injunctive relief, but only to recover damages, costs, and fees. Also, as the regulations expressly state in 12 C.F.R. 1024.41, borrowers are not entitled to any specific loss mitigation resolution, regardless of whether they submit a timely and complete loss mitigation application. Nor are the borrowers given the right to enforce an agreement between the servicer and the investor to achieve a desired loss mitigation resolution. Instead, borrowers' rights under these regulations are limited to induce the servicer to review the application, to delay the start or the progress of a foreclosure action while the review is conducted, and to trigger the duty of the servicer to communicate the results of the review. But note that the borrowers will have greater rights once a revised version of Sec- tion 1024.41 goes into effect on October 17, 2017. Borrowers will have additional rights to receive disclosures when they are under a forbearance or repayment plan. Also, borrow- ers will be able to hold transferee servicers to the same duties as servicers that transferred the Matthew J. Richardson is Manley Deas' Director of Litigation and Compliance. roughout his career, he has practiced in the areas of commercial and financial services litigation and currently focuses his practice on defending mortgage servicers in trials and appeals. Before he began practicing, Richardson clerked for the Honorable Howell Cobb in the Eastern District of Texas. What obligations do the new RESPA loss mitigation regulations impose on servicers? Broadly, the new RESPA loss mitigation regulations require that servicers develop effective policies and procedures for reviewing loss mitigation applications and for communicating with borrowers once their loans are in default (12 C.F.R. 1024.38 -.41). More specifically, the regulations require that servicers review timely submitted loss mitigation applications for completeness and for any applicable loss mitigation resolutions. e regulations also require servicers to conduct their reviews of loss mitigation applications within a reasonable time frame and to communicate to borrowers if their applications are complete and whether borrowers are entitled to any loss mitigation resolutions. Finally, if borrowers are denied for the prospect of a loan modification, the regulations require that servicers provide borrowers with the specific reasons that they were denied and further to provide the notice that the borrowers may appeal the denial to different personnel employed by the servicers. What rights do borrowers have under the RESPA loss mitigation regulations? Borrowers generally have the right to induce their servicers review one single, complete, and timely submitted loss mitigation application submitted on or after January 10, 2014, the date COUNSEL'S CORNER LEARNING LESSONS FROM DIVERSE COURT CASES Matthew J. Richardson Director of Litigation and Compliance Manley Deas Kochalski, LLC "However, several district courts are taking notice that many borrower claims are so fact-intensive as pleaded that the district court will deny a servicer's motion to dismiss."

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