Skip to main content

CFPB Reaches $1.275 Million Settlement With Specialized Loan Servicing
May 11, 2020
Photo credit: Getty Images/fizkes

The Consumer Financial Protection Bureau has reached a settlement with Specialized Loan Servicing LLC, a mortgage-loan servicer based in Colorado. The consent order requires the business to pay $1.275 million in monetary relief to consumers in the form of redress and waiver of borrower deficiencies, pay a $250,000 civil money penalty, which will be deposited into the bureau’s Civil Penalty Fund, and implement procedures to ensure compliance with the Real Estate Settlement Procedures Act (RESPA) and its implementing regulation, Regulation X.
In the settlement, Specialized Loan Servicing consented to the order's issuance "without admitting or denying any of the findings of fact or conclusions of law," but consented to the facts necessary to establish the CFPB's jurisdiction.
The CFPB found that since January 2014, the lender violated RESPA and Regulation X by taking prohibited foreclosure actions against mortgage borrowers who were entitled to protection from foreclosure, and by failing to send or to timely send evaluation notices to mortgage borrowers who were entitled to them. These violations also constitute violations of the Consumer Financial Protection Act of 2010. In some cases, Specialized Loan Servicing's violations of Regulation X short-circuited protections for consumers whose homes were ultimately foreclosed upon.
Under the settlement, Specialized Loan Servicing will pay $775,000 in restitution to affected consumers according to a redress plan that the CFPB will approve. The lender will also pay a $250,000 civil money penalty to the CFPB, and will waive $500,000 in borrower deficiencies. The settlement requires Specialized Loan Servicing to implement policies and procedures that will ensure that borrowers receive the protections from foreclosure to which they are entitled under RESPA and Regulation X, including preventing the company from improperly making first filings, from improperly moving for foreclosure judgments or orders of sale, and from conducting foreclosure sales against borrowers who have submitted timely and facially complete or complete loss-mitigation applications. The servicer must also monitor its foreclosure activity to ensure that it complies with the policies and procedures that it must implement.
As of Feb. 29, 2020, Specialized Loan Servicing had a portfolio of mortgage loans worth about $112.69 billion. 

Inventory Begins A Slow Recovery

Inventory grew 3.9% from April to May, according to Zillow's latest Market Report, after a year of steady decline.

Industry News
Jun 16, 2021
Mortgage Lenders Expect Profit Margins To Shrink

69% of lenders believe profit margins will decrease in the months ahead, while 19% believe profits will remain the same, and 11% believe profits will increase.

Industry News
Jun 14, 2021
Real Estate Industry Calls To End Eviction Moratorium On June 30, 2021

Expanding the moratorium will only increase levels of debt on renter households and impede the recovery of the housing sector.

Industry News
Jun 14, 2021
Fifth Third Bank Expands Down Payment Assistance Program

The program will provide up to $3,600 towards a down payment for families with low to moderate income.

Industry News
Jun 09, 2021
Filo Mortgage Launches Low-Rate Guarantee

National mortgage lender Filo Mortgage is offering to beat competitors' pricing by $1,000 with its Low-Rate Guarantee.

Industry News
Jun 08, 2021
FAU Index Shows Where Consumers Should Buy Or Rent

Consumers are better off renting in cities like Dallas, Texas

Industry News
Jun 07, 2021