ThinkProgress-
Last week, the Consumer Financial Protection Bureau (CFPB) released a report detailing abuses by mortgage servicers. Despite numerous legal settlements and pledge after pledge by servicers that they follow the law, the report exposes the many ways these companies have continued to do wrong by consumers, making the case for a strong financial regulator to protect consumers from unscrupulous or incompetent financial services firms.
Mortgage servicers are the companies primarily responsible for collecting mortgage payments from borrowers and forwarding them on to the lender or, if the loan is securitized, the investors. They are also the companies in charge of foreclosing on homes or helping troubled borrowers modify their loans to avoid foreclosure. Since the start of our housing crisis, servicers have become notorious for their failure to perform even routine administrative tasks competently as well as for forging paperwork and foreclosing on borrowers even when modifying their loan would have returned more value to the loan’s owner.