Feds, state AGs seek to merge mortgage servicing standards
It is looking more likely new mortgage servicing requirements from federal regulators will be merged with the separate settlement under development by the 50 state attorneys general. Servicers signed consent orders with the Office of the Comptroller of the Currency, the Federal Reserve and the Office of Thrift Supervision in April, agreeing to submit action plans, detailing how they will boost staff and comply with new requirements. These include establishing a single-point of contact and prohibiting foreclosures while a loan is being evaluated for a modification among others. Many mortgage servicers suspended the foreclosure process to correct mishandled documentation in the fall of 2010, prompting an investigation by these regulators, the Justice Department and the 50 state AGs. In June, OCC gave the banks a 30-day extension to submit their plans at the request of the DOJ. "The national bank mortgage servicers have now submitted action plans, pursuant to the extended deadlines, which will undergo a period of review by the OCC," according to a spokesman at the agency. "The OCC may require changes to the plans, and negotiations involving DOJ and other federal and state authorities are highly relevant to their content," the spokesman added. "It continues to be our goal to synchronize details of the plans ultimately approved by the OCC with the product of those negotiations to produce a consistent set of servicing requirements." A spokesman for Iowa AG Tom Miller, the lead investigator from the states, said in the end, their office hopes to coordinate their settlement with the OCC action plans. The OCC will not release the action plans. The agency's chief counsel Julie Williams said during a hearing before Congress last week that regulators will release results of a "look back" review of how widespread the foreclosure problems became. Individual bank names will not be released, however. Write to Jon Prior. Follow him on Twitter @JonAPrior.