CFPB Director Richard Cordray, shown in March 2015, has announced new protections against foreclosure.
Credit: Steve Helber / AP
The Consumer Financial Protection Bureau has issued new rules aimed at protecting widowed homeowners from a red-tape nightmare that has caused them to lose their homes to foreclosure. (emphasis added)
The regulations, announced Thursday, generally give surviving spouses who are not on a mortgage note the same protections borrowers have. Those include a ban on so-called dual tracking in which mortgage servicers negotiate with clients to modify a mortgage while simultaneously pursuing foreclosure.
The rules, which expand and clarify existing guidance from the agency, were long awaited by consumer groups that are pushing similar regulations in a pending California Senate bill.
Those advocates say survivors — who already owned their homes or inherit them after a death — face considerable resistance from servicers when they seek loan modifications after losing their spouse’s income.
Often companies won’t allow a modification until the surviving spouse assumes the loan, which […]
